The world knows about it, but its entrance was late. The rise of this automotive power has been the country’s talk ever since there were initial plans for the new India, a more developed nation that stood on globalization and world power lines. The Automation Industry has grown at an unprecedented scale in India, and the growth has attracted a lot of investors and companies who had eyed India to establish their industries. One of them is Tesla, which has now officially entered into the Indian automotive game. With registrations now officially complete, Tesla has now taken a new path. It’s time to enter the market that truly needs a huge shift towards electricity due to pollution.
By registering the company in the country, a regulatory filing showed on Tuesday; Tesla Inc (1) has moved a step closer to its launch in India later this year. Tesla Motors India and Energy Private Limited, a hub for several global technology companies, was incorporated on Jan. 8 with its registered office in the southern city of Bengaluru. According to the LinkedIn profile, the filing indicates that the Indian unit has three directors, including David Feinstein, a senior executive at Tesla. In December, India’s transport minister, Nitin Gadkari, told a local newspaper that the U.S. electric car manufacturer would start sales and then look at assembly and production (2).
India has been a huge destination for companies like Bosch, Mahindra Electric, Ather Energy, Daimler, and others to work in electric cars. If things go well, Tesla will be the new entrant in the country (3). Musk had previously suggested that the launch of the Tesla facility would hopefully take place in India soon. He blamed the Indian government’s policies for not having ventured into the country until now. In addition to bringing new technical capabilities to electric vehicles every year, Tesla has been expanding avenues in self-driving cars and currently stands at a market capitalization of more than 600 billion dollars (4).
In the past, Gadkari was an advocate of using electric vehicles. He said that the company might try to begin operations in India by early 2021 while talking about the Indian Express Idea Exchange program. The business will begin with sales first, followed by assembly and production based on the reaction received. He hopes that, in the next five years, India will become a car manufacturing hub. As a man who had made the right choice, Elon Musk’s entry has touched at the right time. With the rising pollution levels in the country and Delhi facing their worst record, the shift to electric has been on call ever since. Many fuel-using companies also have been developing electric vehicles, and now with Tesla, the momentum on the project has been boosted (5).
The Electric revolution
A sudden wave of enthusiasm had gripped the global automotive industry since India announced its intention to electrify all new vehicles by 2030. In India, several global and local OEMs have started working on India’s respective electric vehicle strategies. Dividends could be reaped by progressive efforts in charging infrastructure and localized battery production, encouraging OEMs to launch EVs for Indian consumers (6). For India to make the EV dream a reality, it is important that, given its complementary nature, enablers such as the charging infrastructure network, localized battery, and product availability move in tandem. While the government and other players in the ecosystem are making the right battery and charging infrastructure moves, we hope that OEMs will also begin to think beyond institutional customers such as government entities and fleet operators and focus on the needs of retail customers to generate sustained momentum and make the dream of the EV a reality (7).
Tesla has been interested in expanding to India for years, but those plans have been met with one hiccup after another. Musk shared in a 2018 tweet that some government regulations have emerged as a roadblock in India. To pre-order the Model 3 in 2016, even a handful of Indians paid the token amount of a thousand dollars. Musk later blamed the delay in bringing the electric vehicles to India at the time on local regulations. On top of that, in 2015, Prime Minister Narendra Modi also visited the Tesla facility in California. Furthermore, Tesla showed interest in the Indian government’s plan to build large factories to produce lithium-ion batteries in 2019 (8)
The two and three-wheelers and commercial vehicles’ light mobility segments will lead the penetration of electric vehicles in India by 2030. In the personal mobility segment, electric cars’ reach will be only 10 percent -15 percent. According to a KPMG and CII study titled Shifting gears (9), electric cars for ride-sharing and taxis may see traction of 20 percent to 30 percent. The three-wheeler adoption is expected to be around 65 percent to 70 percent by the end of this decade. Electric two-wheelers may have only 25 percent to 35 percent penetration, with many startups offering different product ranges at an attractive price and ownership models. They are made more commercially viable by their price and fuel economy.
Electricity distributors and oil and gas players worldwide are developing solutions and entering into EV charging infrastructure partnerships. While private chargers play a major role in charging infrastructure availability, rapid public charging is also picking up. The government has issued guidelines and standards for public charging infrastructure to allow faster adoption of EVs, wherein plans for the roll-out of public charging infrastructure have been phased out. Based on the proposals received, 2,636 public charging stations have been sanctioned by the union government in 62 cities across 24 states and union territories installed by 19 public entities (10).
The Tesla Entry and establishment
The wait is finally over, as Tesla has officially entered India. This was a plan that was in the making for many years as Elon Musk felt the potential of Telsa in India. He studied India’s market growth and need and realized it earlier than the others. As he makes his first big move, it proves as an example to all the other Electric vehicle companies to initiate the making for EVs as soon as possible. The market for EVs in India is so tender, and into the new decade, many new technologies are essential for the change that India’s weak economy requires. The Tesla launch move may well put India on the map alongside those countries that have moved to respond to the environmental changes and grow a new and successful market for years to come (11).
Tesla had registered its India arm in Bengaluru on Tuesday evening, a hub for several global technology companies. It plans to create a manufacturing plant and Research and development unit in India, aiming at entering the Indian automotive market. The new entity, Tesla India Motors and Energy Private Limited, is registered in Bengaluru, Karnataka, and is classified as a foreign company subsidiary, according to the Registrar of Companies (RoC) filing. The filing also has its registered office in Lavelle Road, a business district in the southern city, with a paid-up capital of 1 lakh and an authorized capital of 15 lakh.
By registering the company in the country, a regulatory filing showed on Tuesday; Tesla Inc has moved a step closer to its launch in India later this year. Tesla Motors India and Energy Private Limited, a hub for several global technology companies, was incorporated on Jan. 8 with its registered office in the southern city of Bengaluru. According to his LinkedIn profile, the filing indicates that the Indian unit has three directors, including David Feinstein, a senior executive at Tesla.
The state government had previously said that Tesla would open a research and development center in Bengaluru. Still, it offered room for any other plans that the company might have, including a production plant. At the end of December, Union Road Transport and Highway Minister Nitin Gadkari said that Tesla would start operations in India earlier this year with sales and then venture into electric car assembly and manufacturing. The likely entry of Tesla into India comes when the union and state governments have promoted greater adoption of green vehicle technologies to lower the carbon footprint (12).
Tesla’s top-selling Model 3 is estimated to be around 28 Lakh to INR 40 Lakh and is expected to be released for almost around 70 lakhs on the Indian market. It is important to note that India still does not have a market for high-end EVs, and it is expected that the launch of Tesla will drive many producers to this segment.