Tesla’s entry into the Indian market is a key component of its broader diversification strategy, extending beyond its focus on China. The renowned global electric vehicle (EV) company is currently engaged in advanced discussions to make a significant foray into India. Sources closely connected to the company’s official business plans reveal that Tesla is contemplating a substantial investment of nearly $30 billion over the next five years, potentially transforming the nation’s burgeoning EV landscape. A substantial portion of this investment, approximately $3 billion, is earmarked specifically for commencing production of a new small car at an Indian manufacturing plant.
The move is strategically aimed at catering to the needs of the broader developing world. Pending favorable policy conditions, Tesla plans to introduce its standard brands to the Indian luxury automobile market. Simultaneously, the company aims to kickstart the development and evaluation of a charging infrastructure—an integral element for the widespread adoption of electric cars. Potential locations for Tesla’s manufacturing plant in India include Tamil Nadu, Maharashtra, Gujarat, and Haryana. Given its export-oriented plans, the company is likely to choose a coastal state in the west or south.
This development is seen by insiders as a potential “Suzuki moment” for India’s electric vehicle industry and an “Apple Plus moment” for the country’s manufacturing objectives. However, Tesla’s impact extends beyond being merely an automaker; it operates as a multifaceted tech business, engaging in critical mineral mining and refining, semiconductor production, design, and ecosystem creation. This diversified approach has far-reaching effects on various industries. Elon Musk’s admiration for India and Prime Minister Narendra Modi is evident in Tesla’s keen interest in the country.
Musk, an admirer of Modi’s energy and achievements for India, has discussed his fascination with Indian spirituality and meditation with the Prime Minister. Following their recent conversation, Musk expressed optimism about India’s potential for a sustainable energy future, incorporating solar energy, stationary battery packs, and electric cars.
He also expressed the hope to introduce SpaceX’s Starlink satellite internet service in India. Musk conveyed that Modi’s commitment to India has motivated Tesla to make substantial investments in the country. The Tesla CEO stated that he believes Tesla will establish a presence in India as swiftly as possible. A spokesperson for India’s foreign ministry later confirmed that Modi had invited Musk to explore potential investments in the country’s rapidly growing commercial space and electric vehicle sectors.