Tesla’s likely entry into India is gaining momentum and in the latest development it is seen to be in talks with none other than Mukesh Ambani to drive into what is one of the biggest automobile markets in the world. Hindu BusinessLine reported citing sources that the leading US electric vehicle company is currently in discussions with Reliance Industries regarding a potential joint venture to establish a manufacturing facility in the country.
A person familiar with the situation told the newspaper that discussions have been ongoing for more than a month at the initial stages and the initiative should not be interpreted as RIL’s foray into the automotive sector. The objective of RIL in the joint venture is stated to be the development of electric vehicle capabilities in India, the source added.
ET Online has not verified the story.
Another source said that although RIL’s specific role has not been finalised, it is anticipated that the Indian conglomerate will likely have a substantial involvement in setting up the manufacturing facility and the associated ecosystem for Tesla in India.
Tesla CEO Elon Musk on April 9 had said it will be a natural progression for Tesla to provide electric vehicles in India. Musk’s statement came amid reports about Tesla scouting for a location to set up its factory in India.
“India is now the most populous country in the world, based on population. India should have electric cars just like every other country has electric cars. It’s a natural progression to provide Tesla electric vehicles in India,” Musk said in a X (previously Twitter) Spaces session with Nicolai Tangen, CEO of Norges Bank Investment Management.
According to reports from news wire agency ANI, sources indicated that Maharashtra and Gujarat have presented attractive land proposals to Tesla Inc. for the setup of an electric vehicle (EV) manufacturing facility. Additionally, discussions with the Telangana government are reportedly underway for a similar arrangement with the EV giant.
The proposed facility, which will draw an investment of approximately USD 2 billion to USD 3 billion, seeks to address the demand for Tesla’s electric vehicles both within India and abroad.
Earlier this month, Reuters reported citing sources the company has commenced the production of right-hand drive vehicles at its facility in Germany. These cars are intended for export to India later this year, signaling Tesla’s progress toward potential entry into the world’s third-largest automotive market.
The agency also reported a delegation from Tesla is expected to visit India later in April to assess potential locations for establishing a domestic car manufacturing facility.
The Indian government earlier this year had announced a new EV policy that offered lower import duties for EVs, paving the way for automakers such as Tesla to come to the country.
In 2023, Reliance had collaborated with Ashok Leyland to introduce India’s inaugural heavy-duty truck powered by a hydrogen internal combustion engine. Additionally, RIL revealed removable and swappable batteries for electric vehicles the previous year.
India’s electric vehicle (EV) market, although modest in size, is experiencing steady growth and is currently led by domestic automaker Tata Motors. Electric models accounted for 2% of total car sales in 2023, yet the government aims to increase this figure to 30% by 2030.
In January, VinFast, a Vietnamese competitor to Tesla, announced plans to invest USD 2 billion in India and initiated the construction of an EV factory in Tamil Nadu state.
