US-based international Electric Vehicle (EV) manufacturer giant Tesla Inc finally launched its most awaited subsidiary in India. The Electric Vehicle manufacturer registered itself with the Registrar of Companies (RoC) in Bengaluru, Karnataka as ‘Tesla India Motors and Energy Private Limited’ on January 8, 2021. This is seen as the first step in its much-talked plans to start a manufacturing plant and Research and Development (R&D) unit in India. Billionaire Elon Musk’s Tesla’s this move will be a stepping stone in India’s journey towards Green Mobility.
Although, earlier, at the end of the year 2020, Union Minister Nitin Gadkari said that first Tesla would start selling cars in early 2021, and then it would go for production. But, reported by the Times of India, the officials from Karnataka were already talking about R&D with Tesla and the Karnataka government has already proposed a list of locations for the same. Moreover, aside from manufacturing and R&D, Tesla is looking for sites to sell and market its vehicles in India. However, its initial sales will rely mostly on on-demand based imports.
Indian subsidiary registered with capital ₹15 lakh
According to the Registrar of Companies (RoC), the Tesla subsidiary is registered as an unlisted private company with an authorized capital of ₹15 lakh and paid-up capital of ₹1 lakh. It has also listed three persons as directors, named Vaibhav Taneja, Venkatrangam Sreeram, and David John Feinstein.
Tesla’s Price Uncertainty & gearing up to sell Model 3 Car
Although the registration is done, there is no clarity about the exact start of Tesla’s subsidiary operations in the country and what exactly it will do. But, before July 2021 it will start to sell its cars in the Indian market at different prices compared to US and European countries. Depending upon the import duty, demands, market values, affordability of buyers, and sales the prices may vary in India.
Still, Tesla is expected to commence sales of its very famous and cheapest E-Car Model 3 in India through an online portal. This variant will be priced about ₹55-60 lakh ($75,000-$81,500 approx.). Obviously, it would not be cheaper for most buyers, specifically in India. All cars will be CBU (Completely Built-Up) and will be imported through the sea route into India.
What Tesla’s Electric Car provides you?
If it is Tesla’s Electric Car in the market, definitely it will be designed with innovations and advanced technology, luxuries, ergonomics, attractive features, green technology, etc. But, will it be affordable or demandable at the required level in the Indian market is a major question. As Indians mostly prefer to purchase two or three-wheelers compared to four-wheelers, Tesla Car purchase will be even low. In India, about 85% of vehicle sales come from non-four-wheeler vehicles.
Besides, Tesla’s Supercharger network has been instrumental in helping the automaker’s growth. It already has over 20,000 chargers worldwide, covering all major markets. The latest V3 Superchargers support peak rates of up to 250kW per car, which can recover 75 miles worth of driving in just 5 minutes, while a full charge takes about an hour.
Will this entry make the EV race more competitive?
First, we should know that Tesla is not the first and sole company to enter into Electric Vehicle (EV) market in India. As the Karnataka government has already claimed, there are more than 45 EV start-ups based in Bengaluru alone. So, the competition and comparison will not be an easier one. R&D units of Mercedes-Benz, Great Wall Motors, General Motors, Continental, Mahindra & Mahindra, Bosch, Delphi, and Volvo are already operational in Bengaluru. Moreover, start-ups like Mahindra Electric, Ather Energy, Ultraviolette Automotive, Ola Electric are focused on two-wheeler electric vehicle manufacturing.
Even though, the world-class technology and unprecedented innovation capabilities make Tesla be more winning entity in this race. By setting up R&D in India, Tesla’s intention is to get benefited from the large Engineering and IT talent pool generated in-country. And these all will help Tesla to sail through the Indian EV market swiftly, but uncertainties about its sale, affordability by citizens, and market profit, mainly in the initial stages, are still there.