Tesla, India Commerce Minister To Discuss Factory Plans For $24K EV

Tesla has expanded its manufacturing footprint massively in recent years, going from a single vehicle assembly plant in 2018 to four in 2023: Fremont, Shanghai, Berlin, and Austin. 

Another massive EV factory has been confirmed in Mexico on a site that’s reportedly twice the size of the Texas plant, in addition to expansions at Fremont, Giga Shanghai and Giga Berlin.

And Tesla isn’t planning on stopping soon. The EV maker has been ramping up negotiations with India’s government to build a factory in the world’s most populous country.

In the latest development of Tesla’s relations with India, representatives for the automaker are expected to meet India’s commerce minister Piyush Goyal this month in New Delhi to discuss plans to build a factory in the country, a person with direct knowledge of the matter told Reuters.

Tesla has shown interest in building an assembly plant in India that would produce low-cost electric vehicles for the local market and for export, the source said, adding that the company had indicated that the new factory would be for a new vehicle that would start around 2 million Indian rupees, the equivalent of $24,500.

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The target price for the new Tesla vehicle was reported earlier this month by The Times of India newspaper. A Tesla priced from $24,500 would be 25 percent cheaper than Tesla’s current lowest priced car, the Model 3 sedan. The talks with India’s commerce minister are expected to focus around Tesla setting up an EV supply chain and discussing land allotment for a factory.

The meeting with the commerce minister would be the highest level discussions between Tesla and the Indian government since June when Elon Musk met India’s Prime Minister Narendra Modi in the US and announced he intended to make a significant investment in the country.

Tesla last year lobbied the Indian government to reduce import taxes on EVs shipped to India, but officials called on the company to commit to making cars locally. 

The negotiations appeared to break down, but they resumed and picked up speed in May this year when Reuters reported that Tesla executives visited India and held talks with officials on establishing a manufacturing base for cars and batteries in the country.

India is the world’s third largest auto market but electric vehicles currently make up less than 2 percent of total sales in the country.