Tesla to import completely made electric cars from Germany into India

Earlier this month, Reuters reported that Tesla is planning to build a $26,838 car at its factory near Berlin

Elon Musk-led Tesla is likely to make its foray into the Indian market by directly importing cars from its gigafactory in Germany, according to a report by Moneycontrol. This comes after the Centre has reportedly dissuaded Tesla from importing any car from its Shanghai facility.

A source was quoted in the report as saying that the rising geopolitical tensions between India and China is the main reason for the Centre to deny Tesla. Moreover, India and Germany had recently inked pacts on several disciplines, which the US car maker may leverage.

Earlier this month, Reuters reported that Tesla is planning to build a 25,000 euro ($26,838) car at its factory near Berlin. The German plant currently produces the Model Y, Europe's best-selling electric vehicle.

The carmaker is also planning to double the German plant's capacity to 1 million vehicles a year but has not provided an update on how many cars it produces there since March when it said it had produced 5,000 vehicles in a week - equivalent to around 250,000 annually.

Commerce Minister Piyush Goyal will meet Musk in the United States next week as the two sides look to advance the US carmaker's plan to enter the South Asian market. The meeting between Goyal and Musk will be the most high-profile one since the Tesla boss met Indian Prime Minister Narendra Modi in June and later said he was keen to make significant investments in the country.

Prime Minister Narendra Modi's office held a meeting with various ministries on Monday to expedite the new EV policy. The third person added the government is also analysing the impact the new policy could have on the Indian EV market, as local carmakers have often said lower EV import taxes could disrupt the market and hurt their plans.

Tesla first tried to enter India in 2021, pushing officials to lower the 100% import tax for EVs, but last year the talks collapsed when officials conveyed the company would have to first commit to local manufacturing.

(With agency inputs)