Tesla Not Interested in Making EVs in India: Union Minister

• Tesla will launch EVs in India soon but has no plans for local manufacturing.
• India’s EV policy offers import duty cuts for firms investing in local production, but Tesla hasn’t opted in.
• Tesla is facing global challenges, with declining deliveries and a sharp drop in profits.

Heavy Industries Minister Kumaraswamy reported recently that Tesla is not planning on entering the Indian EV market for at least a couple of more years. Tesla, though, is readying itself to enter the Indian market, and local manufacturing is not a consideration in its immediate plans.

The Company has already booked a showroom space at Mumbai's Bandra Kurla Complex and hired over two dozen employees, including store managers and service staff. Tesla is busy with certification and homologation and expects its first EV launch to take place in India within two to three months.

Conversely, a few months ago, India actively strived to set up an EV investment base through a new policy. The policy lowered the rate of import duties to 15% on an import of up to 8,000 EVs per annum, conditional to the investment of the company by not less than ₹4,150 crore (roughly $500 million) to establish local production within three years. Application for this scheme will open soon and shall remain until 15th March 2026.

Also Read: India Launches Manufacturing Mission to Drive $7.5T Industry Goal

The nation envisions carving a niche as a leading hub for EV investment, India being the world's third-largest automobile market. However, slowing demand across the world for EVs has tightened eligibility parameters on the government side, including making companies meet minimum targets, i.e., ₹5,000 crore in year four and ₹7,500 crore in year five—else penalties up to 3% of revenue shortfall upon failure will be levied.

Meanwhile, Tesla is grappling with global challenges, reporting a 13% decline in vehicle deliveries and a 71% drop in net profit in Q1 2025, marking its first annual delivery decline in over a decade.