Tesla Begins Making Cars In Germany For Export To India: Report

There are stronger signs than ever that Tesla could be entering the Indian markets.

Tesla has begun production of cars in Germany which are meant for export to India, Reuters reports. These cars are right-hand-drive, which would be used in India, as opposed to left-hand drives cars which are sold in Germany. Some of these cars can be shipped to India as early as by the end of the year.

tesla india

“The right-hand drive cars which will be allocated to India, they have started building them,” a source said. While it’s not clear which model of Tesla cars are being built under this arrangement, Tesla currently produces the Model Y at its German factory, which is one of its cheaper variants. Thus far, Tesla’s Shanghai plant was primarily creating right-hand-drive vehicles for export to markets such as Australia and Japan.

If the right-hand-drive vehicles being produced at the German plant are indeed meant for India, it would not only mean that Tesla’s cars would soon be available in India, but Tesla is also looking to start production on Indian shores. As per India’s new regulations, EV makers can import as many as 8,000 vehicles a year with lowered duties as long as they invest $500 million in producing cars in India.

There are other indications as well that these cars in Berlin might be bound for India. It has been reported by FT that Tesla is sending senior officials to scout for potential plant locations in India. It appears that Tesla might finalize a site soon, invest as much as $2-3 billion, and begin importing its Germany-produced cars to India.

But there has been many a slip between the cup and the lip over Tesla’s India’s entry. All the way back in 2016, PM Narendra Modi had visited the Tesla factory in the US, and had held discussions with Elon Musk. A year after that, Musk had tweeted that Tesla was in talks with the Indian government to bring their electric vehicles to India. Musk had kept making references to an India entry over the years on Twitter, but nothing had quite materialized.

The talks now seem to have progressed, and Tesla could be already producing cars that are bound for India. It remains to be seen if this latest series of talks end up with something concrete, but if they do, it might be a win-win for both parties: Tesla would be able to access India’s growing market of 1.4 billion consumers, and India would be able to buttress its manufacturing push by managing to get the world’s most valuable auto maker to make its cars on its shores.