Elon Musk will deliver on his promise of launching Tesla in India this time

The much-awaited Tesla launch in India finally happens in 2021. Elon Musk, co-founder and CEO, Tesla, has confirmed that the first Tesla in India launches next year. In all likeliness, the Tesla Model 3 would be the first Tesla launched in India.

Responding to a query on the Tesla Indian launch update from Tesla Club India on Twitter yesterday, Musk said: “Next year for sure.” This isn’t the first time Musk has given the nod for Tesla cars in India, but conditions in India in the EV segment has evolved making it seem realistic than ever.

On 1 April 2016, Tesla opened order books for the Model 3 in India, confirming that it would launch in the country. Musk posted on twitter.com on 7 February 2017 that the company hoped to launch Tesla in India, presumably with the Model 3, in summer that year. On 15 June 2017, he posted on twitter.com that Tesla is in discussions with the Indian government for “temporary relief on import penalties/restrictions until a local factory is built.” This was followed by a tweet on 30 May 2018 citing “some challenging government regulations” deterring the launch.

So, what makes Musk’s claim of launching Tesla in India in 2021 convincing?

1. Adoption of electric cars in India in the 1000s in 2020

The EV adoption has begun with new-age electric cars like the Hyundai Kona Electric, MG ZS EV and the Tata Nexon EV already in the market, with the MG and Tata reaching homes of 1000 buyers already after their January launch. This number is bound to grow with the launch of the 15 upcoming electric cars in India by early 2022. The numbers signal that a growing number of Indian car buyers wish to own a long-range EV.

2. Subsidy & low GST

The central government and state governments are rolling out generous incentives encouraging customers to switch to electric vehicles, and a healthy competition is beginning to develop among states for the best ecosystem in India for electric vehicles. While subsidy may be valid for a limited period and depend on the price segment, state or the type of buyer (personal or fleet), the low GST of 5 per cent is making EVs attractive to manufacturers including luxury brands despite the expensive battery cost.

3. Improving charging infrastructure

Private companies such as Tata Power are expanding charging stations rapidly (700 stations to come up by March 2021) while the government-owned EESL says it would install 10,000 charging points in the country in 3 years, a share of them DC fast-chargers. Some states are also providing sops for establishing EV hubs.

4. Launch of electric vehicles from all luxury brands

As a bonus, luxury electric cars like the Mercedes EQC and the Jaguar I-Pace are coming to showrooms this year, and the Audi e-tron, Volvo XC40 Recharge and the Porsche Taycan are to follow next year. The BMW Group has not confirmed an EV, but Mini India is considering local assembly of the Mini Cooper SE and its a matter of time before the BMW iX or the BMW i7 reaches the country. The barrage of luxury EVs could get Elon Musk’s confidence up to begin sales of Tesla in India even if that means a small scale operation and honouring bookings made from India.

Video Courtesy: Car&Driver Youtube channel

The Tesla Model 3 is the cheapest Tesla currently as its availability was announced in 2017, it is likely to become the first Tesla in India when the company enters next year.

In the U.S., the Tesla Model 3 is available in Standard Plus RWD, Long Range AWD and Performance (AWD) variants. Priced at $37,990 (INR 27.85 lakh), $46,990 (INR 34.45 lakh) and $54,990 (INR 40.32 lakh) respectively, these variants return a range of 250 miles (402 km), 322 miles (518 km) and 299 miles (481 km) respectively as per EPA’s conservative rating method. Expect the official range in India to be noticeably higher.

$25000 Tesla Model 2
A $25,000 Tesla is also in the works, and the launch of Tesla in India could follow a top-down approach.

The Tesla price in India would be competitive to German luxury car brands if it is assembled in the country as the import duty would fall from 100 per cent to 30 percent. India would be the second Tesla assembly plant following Tilburg, Netherlands, if Tesla Motors takes this route instead of appointing an importer and making Tesla a toy for the ultra-rich.