Tesla Starts Production For India, Supply Not From China

American EV Giant Tesla has finally commenced production of RHD vehicles for the world’s third-largest automotive market, India. Interestingly, the brand intends to ship the RHD vehicles to India from its manufacturing plant in Germany, despite early speculations that the cars will be shipped from China.

Tesla Car

Tesla plans to enter the Indian automotive market and establish a presence among the high competition. Initially, there were a few obstacles in Tesla’s plans from the Indian Government, the major being the reduction in taxation for establishing a retail chain when the units shipped into the country are from China.

The brand then stopped for a bit and changed its approach towards the market, which is further supported by India becoming the world’s 3rd largest automotive market and the meeting between Indian Prime Minister Narendra Modi and Tesla founder Elon Musk, during PM Modi’s visit to the USA.

PM Modi and Elon Musk

What led to speculation that Tesla will ship cars from their Shanghai plant in China is the fact that India is a market for RHD vehicles and RHD Teslas are primarily manufactured at that plant itself and are exported to other RHD markets like Japan, UK and Australia.

It speculated for now that the production of Tesla RHD vehicles for India has commenced at the Berlin plant in Germany and considering the distance between Germany and the UK, there is a possibility that the Berlin-made RHD Tesla cars might be shipped to the UK as well.

Tesla Sanghai Plant
Tesla Shanghai Plant

Tesla has further pledged to establish manufacturing facilities in India and is even close to finalising a location for the manufacturing facility. A team from Tesla will likely fly into India and decide between the following locations – Gujrat, Maharastra and Tamil Nadu.

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But for now, Tesla will be bringing vehicles to India via the CBU route, thanks to the revised taxes by the Indian Government on certain EVs whose manufacturers invest a minimum amount of USD 500 million and start production within the next 3 years and the manufacturers can import up to 8000 units into the country at a lower tax rate.