Tesla Searches For Locations For Its First Showroom In India

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Separate sources have indicated that the automaker has started manufacturing right-hand drive vehicles at its German plant for export to India.

U.S. electric vehicle manufacturer Tesla is actively scouting for potential showroom sites in New Delhi and Mumbai as it prepares to launch its sales operations in India later this year, according to two individuals briefed on the matter.

Amid a noticeable decline in global vehicle deliveries in the first quarter—the first drop in almost four years—Tesla is intensifying its efforts to penetrate new markets. The company is planning to establish showrooms ranging from 3,000 to 5,000 square feet (280-465 square meters) along with a dedicated service hub in each of the aforementioned cities, one of the informed individuals revealed.

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In a strategic move to cater to the Indian market, Tesla has initiated the production of right-hand drive vehicles at its manufacturing facility in Germany, aiming for exports to India, as stated by separate sources. In a significant policy shift last month, India reduced the import taxes on electric vehicles to 15% from previously high rates of up to 100% for automakers who commit to investing at least USD 500 million and establishing a manufacturing base in the country.

Tesla’s CEO, Elon Musk, is anticipated to announce new investments and is scheduled to meet with Prime Minister Narendra Modi during his two-day visit to India starting Sunday. This meeting follows their previous encounter in New York last June.

Tesla executives began exploring potential locations last month and have engaged in discussions with various real estate developers, eyeing prime spots along high streets and within malls, according to one source. The company is eager to commence construction promptly to ensure the showrooms are operational by 2024. Tesla is currently facing challenges related to slower growth in the electric vehicle sector in its primary markets, the United States and China. A recent report by Reuters this month highlighted that Tesla had abandoned plans for a much-anticipated affordable car model, which was expected to drive significant growth in the mass market.

The demand for electric vehicles in India, the world’s third-largest auto market, is projected to surge significantly. Electric vehicles accounted for merely 2% of total car sales in India in 2023, yet the government has ambitious plans to have 30% of all new car sales be electric by 2030.

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Aryaman Raghuvanshi
Aryaman Raghuvanshi
Aryaman Raghuvanshi is a Journalist at EFY. His passion is to explore the future of mobility, which gets him to cover latest technologies shaping the future of automobiles and EVs. But, at times he writes on broader technologies too. LinkedIn: https://www.linkedin.com/in/aryaman-raghuvanshi-2431b7153

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