Image: Narendra Modi
Tesla reportedly requested a meeting between Indian Prime Minister Narendra Modi and its CEO Elon Musk. It is assumed that the subject of discussion will be the issue of reducing duties on car imports in order to understand the demand in the local market.
Tesla has called on Indian Prime Minister Narendra Modi's office to lower taxes on imports of electric vehicles before they enter the market, four sources told Reuters. The company aims to start selling its vehicles in India this year, but this is difficult to achieve as taxes on imported cars in the country are among the highest in the world.
Reuters said that according to four of its sources familiar with the case, Tesla executives, including its head of policy in India, Manuj Khurana, in September at a closed meeting passed their demands to Modi officials and explained that import duties are too high. During the meeting at Modi's office, Tesla said that India's duty structure would not make its business in the country a "viable proposition," according to one of the sources.
Currently, India levies a 60% import duty on electric vehicles under $40,000 and a 100% duty on vehicles over $40,000. This makes Tesla vehicles too expensive for buyers and may limit their sales. It will also make it difficult for the manufacturer to estimate the actual demand in the country. If the company could get a reduction in duty, to assess demand—and after studying the Indian market was convinced of the popularity of its cars—then Tesla could start producing them directly in the country.
In addition, Tesla has separately requested a meeting between its CEO Elon Musk and Modi, three sources told Reuters. For now, government officials are divided over the claims of the American automaker. Some of them want the company to commit to manufacturing locally before considering any import tax breaks.
© 2021, Eva Fox | Tesmanian. All rights reserved.
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About the Author
Eva Fox
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.
