According to a source with direct knowledge of the matter, representatives from Tesla are scheduled to meet with India’s commerce minister this month to discuss their plans of building a factory that will produce a new $24,000 electric vehicle (EV). The company has shown interest in establishing a facility in India to manufacture low-cost EVs for both the local market and export, with a specific focus on the new vehicle.
This marks a significant shift for Tesla, as previous attempts to reduce import taxes on EVs in India were met with demands from government officials to commit to local manufacturing. The upcoming meeting with the commerce minister will be the highest-level discussions between Tesla and the Indian government since Elon Musk’s meeting with Prime Minister Narendra Modi in June, during which Musk expressed his intention to make a substantial investment in the country.
The proposed $24,000 EV, as described in discussions about the potential Indian plant, would be approximately 25% cheaper than Tesla’s current lowest-priced offering, the Model 3 sedan in China, which sells for just over $32,200.
Electric vehicles currently represent less than 2% of total vehicle sales in India, despite the country being the world’s third-largest auto market. In May, Tesla executives visited India and engaged in talks with officials to explore the possibility of establishing a manufacturing base for cars and batteries.
The forthcoming discussions in New Delhi will focus on establishing an EV supply chain and discussing land allotment for the factory. Tesla aims to bring down the cost of EVs significantly, and its next-generation vehicle platform is expected to reduce production costs by 50%. The platform could potentially support multiple models, including an automated “robotaxi.”
Presently, Tesla produces EVs in California and Texas, and internationally, it operates plants in Berlin and Shanghai. The Shanghai plant is the company’s largest, contributing nearly 40% of Tesla’s global capacity, and there are plans to expand capacity there, pending regulatory approval. Additionally, a Tesla plant under construction in Mexico will also produce vehicles on the lower-cost platform, which the company plans to replicate in other factories.
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