Tesla will pick new factory location this year, India a contender: Musk

Elon Musk will likely pick a new location for a Tesla factory by the end of this year and according to him, India is very much part of his scheme of things if all goes well. In an interview with Wall Street Journal, when asked if India is an interesting choice for a new Tesla location, Musk responded: "Absolutely". In March this year, Musk selected Mexico for the next Tesla Gigafactory. Tesla has several factories in the US, including in Fremont, California. The electric car-maker also has factories near Berlin, Germany and Shanghai, China.

Reports surfaced earlier this month that a team of senior Tesla executives was reportedly planning to visit India to explore entering the niche EV market and expand its footprint beyond China.

According to a Bloomberg report, citing sources, the discussions with senior India leadership was to revolve around the possibility of local sourcing of components for Tesla`s car models.

Musk has time and again said that he faced challenges from the government for releasing its products in India. "Tesla isn`t in India yet due to "Challenges with the government," he had posted.

The team he hired in India in 2021 was diverted to focus on the Middle East and the larger Asia-Pacific markets last year.

Several top Indian leaders made repeated appeals to Musk to bring Tesla to India but to no avail.

Currently, India levies a 100 per cent tax on imported cars of price of more than $40,000 (Rs 30 lakh), inclusive of insurance and shipping expenses, and cars less than $40,000 are subject to 60 per cent import tax.

With a $40,000 (over Rs 30 lakh) price tag, Tesla Model 3 may remain as an affordable model in the US but with import duties, it would become unaffordable in the Indian market with an expected price tag of around Rs 60 lakh. 

Musk has said that he wants to launch cars in India but the country`s import duties on EVs are "highest in the world by far".