Elon Musk, Welcome to Tesla’s Toughest Test
Context :
Tesla restarts India market talks with new factory proposal … Reuters / 17 May 2023
Extract :
Tesla Inc has proposed setting up a factory in India to build electric cars for domestic sale and export, the carmaker told government officials on Wednesday, according to a source with direct knowledge of the matter.
The proposal comes after India refused to agree to Tesla's request last year to lower the import tax on cars, which can reach as much as 100%. India wanted the carmaker to build vehicles locally but Tesla wanted to test the market first with imports and the talks ended in deadlock.
While Tesla did not discuss lower import taxes with Indian officials, it proposed setting up a new factory, albeit without specifying a location or investment, said the source, who declined to be named as the talks were private.
Making cars locally aligns with Indian Prime Minister Narendra Modi's pitch to attract companies with his "Make in India" campaign, especially as companies look to diversify their supply chains beyond China.
Senior Tesla executives are in India this week to meet the government to discuss local sourcing of parts and other issues, Reuters reported on Tuesday.
Tesla met officials from Modi's office and other ministries on Wednesday, said the person and another source familiar with the matter.
Tesla did not respond to Reuters' request for comment.
The electric carmaker's renewed interest in India comes nearly a year after it put on hold plans to sell cars in the country after failing to secure lower import taxes, which its CEO Elon Musk said are among the highest in the world.
Tesla had hired a local team and began a search for showroom space, but that was also abandoned last year.
The meeting comes weeks ahead of Modi's visit to the United States in June.
MY TAKE :
Ø ELON , You have missed the Bus / by 5 YEARS …………………….. 15 Feb 2022
Ø Will Tesla follow Apple ?............................ [ 23 May 2017 ]
Extract :
Dear Elon :
For immediate approval ( in 24 hours ) , pl submit your PMP as follows :
2017-18 :
Set up factory next to Mundra Port ( Gujarat ) to facilitate world-wide exports
2018-19 :
Source locally , Tyres / Chasis / Body / Electricals / Windows / Dashboards ..etc
2019-20 :
Manufacture in your own factory , Li-ion Battery / Wall-mounted Powerpack Storages / Solar Roof Tiles
2020-21 :
Manufacture RFID Sensors - Cameras – GPS locators
2021-22 :
Augmented Reality Devices / Autonomous Navigation Devices ( Radar – Lidar )
Now , it is very possible that neither Shri Gadkariji , nor Shri Goyalji , would be satisfied with such a slow PMP , spread out over a period of 5 years
They may , well request Elon to cut it down to 3 years
Reducing custom duty ( from current 110 % to 40 % - as requested by TESLA and some other foreign manufacturers , would not make any dent in India’s Electric car market, as can be seen from :
To beat OR not to beat ?........................
At the most , those imported cars ( selling for Rs 40 lakh + , even with 40 % duty ), could have sold 3,000 numbers out of Indian market of 3 MILLION !
That is not the point
Point is simple :
Ø TESLA must come to India with a firm commitment for Local Manufacture
Ø There was nothing difficult for TESLA to accept the Phased Manufacturing Program suggested by me above, some 5 YEARS back
Ø The PMP announced by GOI, last week ( shown above ) is almost IDENTICAL to my 2017 proposal
With regards,
Hemen Parekh
www.hemenparekh.ai / 18 May 2023
Related Readings :
Ø Import Duties : Time to get Rational …………………………. 27 July 2021
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