Tesla is finalizing an agreement to make electric vehicles in India for the first time to capture a new growth opportunity, according to Bloomberg. The EV maker has been negotiating with local officials for six months and is actively considering car assembly in Bangalore for the first plant.
- Tesla is reportedly conducting due diligence for office real estate in Bangalore and plans to set up a research and development facility.
- Tesla has focused on Bangalore because it’s shaping up to be a hub for EV and aerospace manufacturing talent.
- The EV maker has incorporated its Indian unit and registered offices in downtown Bangalore.
- On January 13, Tesla CEO Elon Musk confirmed that the company would enter India.
- Entry into India could prove problematic for Tesla as the country hasn’t yet welcomed EVs like China.
- Although India has been making moves to roll out competitive EV models, the progress has been of a small scale.
- In 2015, India launched a Faster Adoption and Manufacturing of Hybrid and EV (FAME) plan, with a 9 billion rupee ($123 million) commitment to subsidies.
- India has also cut the goods and services tax on EVs to 5% from 12%, much lower than the levies of as much as 28% charged on other motor vehicles.
Tesla stock is currently gaining. TSLA: NASDAQ is up 0.18% on premarket.
XTB
