Tesla Must Overcome Local Production Laws Before Bringing EVs to India

CEO Elon Musk says Tesla continues to be in "discussions" with the national government.

9. 18. 17 by Dom Galeon
Tesla
Image by Tesla

Tesla wants to bring its electric vehicles to India, and they plan to make the Model 3 their first EV in the country by 2019. CEO and founder Elon Musk mentioned it back in June of this year, and now he’s said it again. Replying to a question on Twitter, Musk explained that Tesla continues to be in “discussions” with the national government of India, the second-most populous nation on Earth.

The only difference between his June announcement and now is the focus of discussion — that is, what it is keeping Tesla from bringing their EVs sooner. Back in June, Musk said that they were asking for a “temporary relief on import penalties/restrictions” until a factory, presumably a gigafactory, is built in India.

Now, Musk says the delay is due to difficulties with so-called local content requirements. It’s a policy that requires goods to have a certain percentage of the production process sourced from local manufacturers. Musk is asking for a temporary reprieve from this condition until a gigafactory can be built in India.

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With these hurdles overcome, and the Model 3 production goals met, India could be a great market for EVs. In fact, the country already has legislation to sell only electric cars by 2030. For Tesla, getting into the Indian market before that obtains is crucial, especially with the country on its way to becoming the world’s third-largest car market by 2020.


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