Tesla finally parks in India. But can it survive?

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New Delhi, India – Tesla is yet cruising successful India, the world’s third-largest car market, with the motorboat of its Model Y. The rollout marks the culmination of a decade-long, topsy-turvy journey.

Showcased astatine its caller showroom successful Mumbai, India’s fiscal capital, connected Tuesday, Tesla’s Model Y is present connected merchantability for astir $70,000, a terms comparatively higher than successful immoderate different large market.

Elon Musk’s electrical conveyance (EV) institution is braving precocious tariffs and stiff contention successful India’s nascent but rapidly expanding EV market.

As New Delhi negotiates a commercialized woody with the United States, India’s car assemblage tariffs, arguably among the highest successful the world, are a cardinal topic.

“Tesla’s introduction into India marks a important enlargement of the company’s planetary footprint,” said Kwan Wongwetsawat, a elder car expert astatine the probe steadfast GlobalData. “Before this decision, Tesla faced respective marketplace challenges,” helium said, ranging from geopolitical concerns, a diminution successful planetary sales, and an uncertain motorboat docket for a caller compact model.

So, what’s the buzz astir Tesla coming to India? Can it leverage the processing Indian market? And tin India springiness a enarthrosis to Musk’s EV elephantine arsenic its global income plummet?

What is Tesla offering successful India?

To commencement with, successful India, Tesla has chosen to connection its Model Y successful the mid-range luxury segment, combining its hallmark features: minimalist design, precocious performance, and long-range driving distance.

The driver-assistance exertion is disposable arsenic an add-on for 600,000 Indian rupees, oregon $7,000. Tesla is offering 2 variants of Model Y successful India: the rear-wheel thrust (RWD) and the long-range RWD edition. While the RWD has a scope of up to 500 kilometres (310 miles) connected a azygous charge, the long-range variant has a scope of 622km (386 miles).

In the Indian market, the Model Y volition spell head-to-head with different premium electrical SUVs, specified arsenic the Mercedes-Benz EQB, BMW iX1, Volvo EC40, and Kia EV6. Tesla offers a four-year, oregon 80,000km, conveyance warranty for the artillery and thrust unit, whichever comes first.

“Tesla is the biggest EV institution successful the world, and its introduction successful India is simply a large milestone for the nationalist EV industry,” said Puneet Gupta, who leads the India and Southeast Asia teams astatine automotive quality steadfast S&P Global Mobility.

“It’s not conscionable astir selling cars successful India. But Tesla’s introduction tin assistance India to physique the EV ecosystem,” Gupta told Al Jazeera. “And the biggest interaction of a institution similar Tesla is that it boosts people’s assurance successful EVs arsenic a category.”

The Model Y reaches a apical velocity of 201km/h (125mph), with six coloured exterior finishes. It is equipped with modular features specified arsenic automatic exigency braking, guardant collision alerts, unsighted spot monitoring, and lane departure warnings. Tesla’s signature Dashcam and Sentry Mode supply real-time signaling and alerts for suspicious activity, adjacent erstwhile the conveyance is parked.

Why is Tesla truthful costly successful India?

Tesla’s Model Y rear-wheel thrust is priced astatine 6 cardinal Indian rupees, oregon $70,000, portion the long-range RWD variation is priced astatine astir 6.8 cardinal Indian rupees, oregon conscionable beneath $80,000.

Tesla’s website does not supply the terms breakdown, including delineating the further import tariff costs and levies imposed by a state.

These prices for Model Y are higher than successful immoderate different large car market. They commencement astatine $44,990 successful the United States, $36,700 successful China, and $53,700 successful Germany.

India presently imposes 1 of the highest import work tariffs connected afloat built cars in the world, importantly shooting up prices of overseas vehicles, including EVs similar those from Tesla.

Until recently, India imposed a 110 percent import work connected each afloat built vehicles. The Indian authorities revised this policy, lowering the import work to 15 percent for carmakers committing to put and acceptable up section manufacturing facilities wrong a three-year timeframe.

This steep tariff operation has been a constituent of contention for planetary carmakers similar Tesla, which has agelong lobbied for a simplification successful duties to trial marketplace viability earlier committing to section manufacturing.

US President Donald Trump has repeatedly criticised and called retired India arsenic a “tariff king”. Both countries proceed to negociate a commercialized agreement, wherever the car assemblage reportedly remains a cardinal focus. Musk, Tesla’s CEO, has besides noted that “import duties [in India] are the highest successful the satellite by acold of immoderate ample country!”

What is India’s EV assemblage like?

India has acceptable a nationalist extremity of achieving 30 percent EV adoption by 2030.

While electrical car income successful India accrued by 20 percent successful 2024 from the twelvemonth before, EVs inactive represented conscionable 2.5 percent of the full 4.3 cardinal rider vehicles sold. Despite its comparatively tiny base, the EV assemblage successful India is projected to turn rapidly, from its existent marketplace worth of $54.41bn to $111bn by 2029.

Currently, section manufacturers predominate the space, offering competitively priced EVs tailored to India’s cost-conscious consumers. Tata leads with astir 60 percent of the marketplace stock successful the electrical car segment, followed by JSW MG Motor India – a collaboration betwixt India’s JSW Group and China’s SAIC Motor – and past Mahindra & Mahindra.

High-end electrical cars, priced supra $20,000, made up a minuscule 6.6 percent of full EV income past year. This is wherever Tesla volition person to vie with the likes of Mercedes-Benz, BMW, KIA and Audi.

A impermanent takes photos of Tesla Model Y, displayed during the inauguration ceremonial of the archetypal Tesla showroom successful Riyadh, Saudi Arabia. April 10, 2025. REUTERS/Mohammed Benmansour/File Photo

How are Tesla income faring successful different markets?

Tesla is coming to India arsenic its EV income plunge successful planetary markets, and arsenic the institution bets connected its revised Model Y to crook its fortunes around.

In its location market, the US, income continued to autumn successful the 2nd 4th of 2025 by 6.3 percent, marking Tesla’s 3rd consecutive quarterly driblet successful year-over-year home sales.

Facing protests against Musk’s authorities and earlier engagement with the Trump administration, income person fallen for 5 consecutive months successful Europe. With immoderate consumers switching to cheaper Chinese EVs, Tesla’s marketplace stock has dropped to conscionable 1.2 percent successful May from 1.8 percent a twelvemonth ago.

In China, Tesla’s second-biggest market, the Q2 deliveries fell by astir 12 percent.

“Tesla has been facing pugnacious times globally, truthful the institution besides desperately wants caller markets, and India, being the world’s third-largest market, is simply a large accidental for them to marque up for immoderate loss,” said Gupta of S&P Global Mobility.

In respective countries, Tesla’s Chinese competitors are outselling Musk’s EVs. And that’s wherever the immense Indian marketplace comes into the equation for Tesla, noted experts.

Due to geopolitical tensions betwixt India and China, rival Asian neighbours, lone a fewer Chinese EVs are pitching to the Indian market. In 2023, the Indian authorities rejected BYD’s connection to found a $1bn mill locally. While SAIC Motor operates successful India successful collaboration with India’s JSW Group, BYD relies connected importing aggregate models.

“BYD is simply a nonstop rival to Tesla, but the marque is besides facing challenges successful India and has yet to found section accumulation successful the country,” said Wongwetsat. As a result, helium added that some Tesla’s prices successful India and those of BYD are higher than successful different markets. “However, determination is simply a wide terms favoritism betwixt Tesla and section competitors similar Tata, MG, and Mahindra,” placing Musk’s institution successful the luxury segment.

Unlike different Chinese-dominated EV markets successful Asia, India offers a alternatively unfastened marketplace for Tesla to present high-end features and physique an ecosystem from the crushed up.

“The Chinese companies are not comfy investing successful India, and adjacent Indian consumers are not comfy buying Chinese owed to the uncertain geopolitical situation,” said Gupta.

“For now, the Indian market’s positioning is simply a precise bully vantage for Tesla, wherever you truly don’t get contention from Chinese, which is truly sidesplitting Tesla some successful presumption of terms and features,” Gupta told Al Jazeera.

What challenges does Tesla look successful India?

For starters, India, which has the world’s biggest population, is simply a starkly unequal country, where 90 percent of the colonisation does not person discretionary spending capacity. Tesla’s basal offering is priced astatine $70,000, where, connected a nationalist average, per capita income is $2,880.

Another interest is that India’s infrastructure, including the information of its roads and mediocre postulation discipline, could airs challenges for Tesla vehicles’ little crushed clearance.

India has lone 1 charging presumption for each 235 EVs, with a full of 26,367 nationalist charging stations nationwide for its 1.46 cardinal people. In contrast, the US has much than 61,000 charging stations for its 330 cardinal people.

At its media-only motorboat successful Mumbai connected Tuesday, Isabel Fan, Tesla’s determination director, said, “We are present to make the ecosystem, to put successful the indispensable infrastructure, including the charging infrastructure.” Tesla announced that it volition acceptable up 4 charging stations successful Mumbai. More volition travel to Delhi soon.

“We are gathering from 0 to 100. It volition instrumentality clip to screen the full country,” Fan said.

Reading into the Indian EV market, Wongwetsat of GlobalData said that “Tesla’s accomplishment whitethorn not importantly interaction wide artillery electrical conveyance (BEV) income successful India, but it could pull request from consumers funny successful luxury brands similar BMW and Audi.”

Additionally, the motorboat of Tesla cars successful India whitethorn beryllium conscionable 1 facet of Tesla’s broader ecosystem, Wongwetsat said, which includes sectors specified arsenic star energy, vigor retention systems, and adjacent the abstraction industry, each of which could heighten Tesla’s appeal.

Will Tesla suffer subsidies successful the US?

Musk and the US president’s evident public fallout took a crisp crook earlier this period arsenic Trump threatened to chopped disconnected billions successful national biology subsidies that person benefitted Tesla and Musk’s different companies.

The clash follows Musk’s renewed disapproval of Trump’s tax and spending bill, which includes provisions to destruct cardinal cleanable vigor incentives – specifically, the $7,500 user taxation recognition for electrical vehicles that has agelong supported Tesla’s marketplace growth.

Trump, responding to Musk’s criticism, warned that the Tesla CEO could “lose a batch more” than conscionable EV incentives. The quality has broader implications. Musk has threatened to money campaigns against lawmakers who backmost the measure and adjacent floated the thought of launching a caller governmental party.

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