Tesla Not Interested in Manufacturing in India, Confirms Union Minister HD Kumaraswamy

Tesla, the electric vehicle giant led by Elon Musk, is reportedly not planning to set up manufacturing or production facilities in India, according to Union Minister for Heavy Industries, HD Kumaraswamy. Instead, the company is focusing on expanding its showroom presence across the country.

"Tesla is only interested in establishing showrooms in India, not manufacturing. We do not have any expectations from them in terms of setting up production units," Kumaraswamy said in a statement to news agency ANI.

Despite Tesla’s lack of interest, the minister highlighted that several other global automotive brands — including Hyundai, Mercedes-Benz, Skoda, and Kia — have shown keen interest in manufacturing electric vehicles in India under the country’s new EV policy.

The policy, aimed at boosting local production, allows companies to import electric vehicles at a reduced import duty of 15% if they invest at least $500 million to set up a manufacturing plant in India. Companies are also required to source 25% of components locally in the first three years, scaling up to 50% by the fifth year.

Kumaraswamy also noted that the application window for the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) will open soon.

Trump's Tariff Influence?

Tesla’s retreat from manufacturing plans in India may also be influenced by geopolitical and trade considerations. Former U.S. President Donald Trump had earlier expressed disapproval of Tesla’s potential India expansion, calling it “very unfair.” Similar concerns were raised regarding Apple’s production shift to India amid heightened U.S.-China trade tensions.

Previously, Elon Musk had cited India’s steep import duties as a major hurdle preventing Tesla’s full entry into the Indian market. While the company continues to explore business avenues in the country, manufacturing is no longer part of the immediate plan.