Elon Musk to visit Gujarat in Jan, as Tesla considers setting up EV plant
According to media reports, negotiations for the establishment of a manufacturing unit in India has reached its final stage and will likely conclude soon
Tesla CEO Elon Musk is planning to visit India in January 2024, having received an invitation from Prime Minister Narendra Modi to explore opportunities for investment in electric vehicles and the commercial space sector in India.
According to media reports, the negotiation with the Musk-owned automotive company for the establishment of its first EV manufacturing unit in India has reached its final stage and is likely to conclude soon.
An announcement related to a new Tesla unit in the state is likely to take place at the upcoming Vibrant Gujarat Summit next month, reported the Ahmedabad Mirror.
Gujarat, with its strategic location and favourable business environment, has emerged as the "preferred destination for Tesla's manufacturing plans".
The state government has suggested Sanand, Becharaji and Dholera as potential sites for Tesla to set up its plant, per the Ahmedabad Mirror. Earlier, Maharashtra and Tamil Nadu were also being considered by Tesla, which has since been engaged in intense negotiations with the Union government to seek concessions that would facilitate its entry into the Indian market.
Union commerce minister Piyush Goyal in November 2023 visited Tesla's state-of-the-art manufacturing facility in Fremont, California. He was "extremely delighted to see talented Indian engineers and finance professionals working at senior positions and contributing to Tesla's remarkable journey to transform mobility", he claimed in a post on X—the social media platform formerly called Twitter, coincidentally also helmed by (and controversially renamed by) Musk .
"Also proud to see the growing importance of auto component suppliers from India in the Tesla EV supply chain. It is on its way to double its components imports from India. Missed Elon Musk's magnetic presence and I wish him a speedy recovery," the Union minister had added on X.
Musk, had apologised to Goyal for not being able to meet him as he was not keeping well at the time.
'It was an honour to have you visit Tesla! My apologies for not being able to travel to California today, but I look forward to meeting at a future date,' Musk had replied to Goyal.
Goyal and Musk were scheduled to meet during the minister's US visit, after the SpaceX and X owner met Modi in the US in June and revealed he was keen to make significant investments in India.
According to earlier reports, the automaker had asked the Indian government for an initial tariff concession that would offset India's steep customs duties of 70 per cent for cars under $40,000 and 100 per cent for cars above $40,000.
Tesla had asked for the concession as a condition to constructing a plant in the country, with the reduced tariffs to apply to all EV manufacturers.
India's EV market has the potential to achieve over 40 per cent penetration, with $100 billion revenue by 2030. This growth is expected to be driven by strong adoption (over 45 per cent) in both two-wheeler (2W) and three-wheeler (3W) categories, with four-wheeler (cars) penetration projected to grow to more than 20 per cent, according to a recent report by Bain & Company and Blume Ventures.
All that said, given how things have been going for Musk in the US and the EU lately, a new foothold in India might actually be more to Tesla's advantage than ours, perhaps?