Elon Musk says Tesla wants to launch in India but import duties are too high
Earlier this year in January, Elon Musk-led electronic vehicle manufacturer Tesla registered its first official office in India in Bengaluru. The brand’s office in Bengaluru has its operations in the country as a research and development centre. The EV maker is planning to launch its cars in the Indian market in the coming months. Ahead of the launch, Elon Musk on Saturday said that Tesla wants to release its cars in India, however, the country’s import duties on electric vehicles are way too high.
Elon Musk replies to a user on Twitter regarding Tesla’s launch in India
Yesterday, a user on Twitter tweeted that “Dear @elonmusk please launch Tesla cars in India ASAP!”. In a reply to the user, Elon Musk earlier today replied that his company Tesla wants to launch its cars in India, but high import duties are in the way to do so. "We want to do so, but import duties are the highest in the world by far of any large country! Moreover, clean energy vehicles are treated the same as diesel or petrol, which does not seem entirely consistent with the climate goals of India”, reads the tweet by Musk.
We want to do so, but import duties are the highest in the world by far of any large country!— Elon Musk (@elonmusk) July 23, 2021
Moreover, clean energy vehicles are treated the same as diesel or petrol, which does not seem entirely consistent with the climate goals of India.
Furthermore, "But we are hopeful that there will be at least a temporary tariff relief for electric vehicles. That would be much appreciated," Musk added in another tweet.
Tesla is lobbying Indian ministries to sharply reduce import taxes on E-vehicles
Just a day ahead of Elon Musk’s tweet, a report by Reuters suggested that Tesla is lobbying Indian ministries to sharply reduce import taxes on electronic vehicles in the country. The company is seeking a big reduction in import duties on EVs. In a letter to the ministries and India’s leading think-tank Niti Aayog, Tesla has mentioned that it would be more appropriate to slash import duties to 40 percent in the country. The letter also mentioned that this move will boost demand for EVs and generate revenue for the government.
"The argument is that at 40 percent import duty, electric cars can become more affordable but the threshold is still high enough to compel companies to manufacture locally if demand picks up," one of the sources said, adds the Reuters report. It’s worth mentioning that the sources declined to be identified as Tesla’s letter hasn’t been made available to the public.
It’s worth mentioning that India’s current import duty on fully imported cars that cost over $40,000 is 100 percent and 60 percent for those costing less. The most affordable Tesla car at the moment is the Tesla 3, which costs close to $40,000 for the base model. Notably, the Tesla Model 3 was recently spotted in full camouflage on the roads in Chakan near Pune.
That said, Tesla is still planning to commence its operations in India later this year or early next year. The company was recently offered 1,000 acres of land in Gujarat to set up its plant.