Elon Musk, CEO of Tesla, is poised to announce a substantial investment of $2-$3 billion in India, primarily focusing on the establishment of a new factory. His visit to New Delhi next week, including a meeting with Prime Minister Narendra Modi, is anticipated to unveil these plans, according to two sources familiar with the discussions.
During his visit on Monday, Musk is expected to disclose his strategy for entering the Indian market, which stands as the world’s third-largest auto market with burgeoning potential for electric vehicles (EVs). Although EV adoption in India remains modest, comprising only 2% of total car sales in 2023, the government’s ambitious goal to have 30% of new cars as EVs by 2030 underscores the significant opportunity.
This move by Musk comes at a crucial juncture for Tesla, as the company grapples with sluggish sales in key markets such as the United States and China, alongside recent announcements of layoffs affecting 10% of its workforce.
While details of Musk’s agenda in India are closely guarded, the CEO has confirmed his meeting with Modi on his social media platform X. However, specifics regarding the investment, including the timeline and the location of the proposed factory within India, are yet to be disclosed.
For years, Musk has been vocal about India’s high import taxes on EVs, advocating for policy changes. In response, India recently unveiled a revised EV policy, slashing import taxes to 15% from as high as 100% on select models, contingent upon a carmaker’s investment of at least $500 million and the establishment of a local factory.
In preparation for its entry into the Indian market, Tesla has already initiated the search for showroom spaces in New Delhi and Mumbai. Additionally, its Berlin factory has commenced production of right-hand drive cars, intended for export to India later this year.
Moreover, Musk is anticipated to participate in an event organized by the Indian government in New Delhi, focusing on space startups, further underscoring his multifaceted engagement with India’s business landscape.