We have good news for Tesla Inc (NASDAQ:TSLA) fans in India. The electric car company may soon launch its products in India.
According to a tweet by Tesla CEO, Elon Musk, Tesla may launch in India by Summer this year. The tweet was in response to another tweet from a Tesla fan India. Musk does not confirm the date; he just tweeted “Hoping for summer this year.”
Tesla has been planning to launch in India
But for those who follow the news, Tesla interest in India is not entirely new. India is one of those countries where the Tesla Model 3 preorders are available. To preorder, one only need to make a $1,000 refundable deposit.
In another tweet, last year around March, Musk said that the rolling out of the Model 3 would include setting up a nationwide supercharger network in India. Superchargers are roadside stations that recharge Tesla batteries in minutes. Currently, they are all over the USA.
Tesla challenges in foreign markets
Tesla has encountered challenges in new markets in the past. Its launch in China did not go as they expected. Even after setting up Superchargers, service centers, and hiring a lot of local labor, its sales during 2014 were only 3,500, a figure far behind local competitors such as BYD and BAIC.
Challenges in India
A launch in India will not be any easier either. To start with, India imposes heavy import duties on foreign automakers. Tesla could avoid the crazy taxes by establishing a manufacturing site in India, but this will also be a very heavy investment. A cheaper option for Tesla will be to launch the Model 3, because it is cheap (only $35,000), rather than launch the other luxurious cars.
Heavy import duties are the only thing that should worry Tesla. India has an unreliable power grid, and, well, Tesla cars rely heavily on electricity. Also, the heavily crowded roads in India are unsuitable for Tesla’s sleek electric cars.
The heavily populated (1.3 billion) Indian economy entices many companies, including Tesla in this case. The big question is, “Is India ready for Tesla cars?” The CEO seems very hopeful, but so far we have not seen any concrete plans by the company to launch in India.
That is not to say the launch cannot happen. The fact that the CEO mentioned it is an indicator that there are such plans. We can only wait and see the plans, and progress in the coming months.