Tesla Model 3 May Not Come to India in 2017; Local Sourcing Norms Create Roadblock!
Early last year Elon Musk, CEO – Tesla, announced the entry of Tesla into the Indian shores, with the cheapest vehicle, Model 3. Fast forward 10 months, Elon Musk tweeted about the timeline for Tesla’s launch in India, and it was projected to be launched this summer.
Now comes the bad news. Indian summer is already here, and there is no sign or news about Tesla opening its own showroom and testing its car here. In fact, when someone tweeted Musk, his reply upset every automobile lover.
On being asked if Tesla is launching Model 3 in India in June-July 2017, Musk said, “Maybe I’m misinformed, but I was told that 30 per cent of parts must be locally sourced and the supply doesn’t yet exist in India to support that.”
The local sourcing norms require Tesla to source 30% of the parts from the domestic market before setting up its own stores and showrooms in India. We also know how slow the electric vehicle market in India is progressing.
If Musk’s tweet is to go by, then Tesla is definitely not entering India this year. Even for 2018, we can expect the company to launch Model 3 in India only the end of the year. However, one thing is for sure that the company is eager to launch the car because of the sheer growth numbers.
Elon Musk wants to source some of the parts of the car domestically in order to keep the prices low, but the production line hasn’t been ramped up enough to support 30% materials from here. If Tesla 3 comes as a completely built-up(CBU) unit, which is basically importing the whole assembled car here, then the prices will go up drastically.
Tesla’s plans might be delayed, but the Prime Minister of India is sure on track to produce clean energy in the years to come. Tesla not only has to set up the factory to produce Model 3 in India but also install charging stations, which will need smart planning. This news might not make you happy, but it is better to wait for a better-finished product than a hasty one.
Electric vehicle market in India isn’t mature yet, but the entry of Tesla might expedite things. Local automobile manufacturer and Japanese automakers might want to introduce their fully electric vehicles, instead of hybrid cars.