Tesla one step closer to introducing vehicles in India

Electric-car giant Tesla is reportedly moving closer to an agreement with the Indian government to manufacture and sell its vehicles in the South Asian country starting in 2024.

According to a Bloomberg report, Tesla is considering building its factories in Gujarat, Maharashtra or Tamil Nadu – with the electric-car maker expected to invest a reported $US2 billion ($AU3.5 billion) to set up manufacturing roots in India.

However the deal is yet to be finalised, and could change.

Unnamed sources reportedly told Bloomberg the plans could be announced during the Vibrant Gujarat Global Summit in January 2024, with Tesla also reportedly considering purchasing up to $US15 billion ($AU22.8 billion) worth of components from local Indian suppliers.

The Elon Musk-led company already has factories in the US, China and Germany – with talks of a manufacturing expansion in India circulating after Commerce and Industry Minister Piyush Goyal was spotted visiting one of Tesla’s US facilities in Fremont, California earlier this month.

Mr Goyal claimed the electric-car giant is sourcing components for its vehicles in India valued at approximately $US1.9 billion this year, an increase from the claimed $US1 billion the company spent in 2022 – as reported by Indian newspaper The Hindustan Times.

As part of the reported deal, it's said Tesla could produce some of its electric-car batteries in India to reduce production costs – with the Tesla Model 3 reported to be the first vehicle introduced in the Indian market sometime in 2024.

Under Prime Minister Narendra Modi, the Indian government is reportedly planning to rework its electric-vehicle policy – reducing the current import taxes for car makers who are “committed to some local manufacturing”, according to a previous Reuters report.

The India Times reported this electric-car government plan could see vehicle manufacturers import electric cars to India “at a reduced tax as low as 15 per cent, compared to the current 100 per cent that applies to cars which cost above $[US]40,000”.