Tesla is reportedly in discussions with three Indian auto component suppliers as it looks to enter the Indian market.
The Parts In Question
It is looking for critical electrical, electronic and mechanical components.
These include instrument panels, windshields, differential brakes, gears and power seats.
Indian Makers Already Catering To Tesla
Sona Comstar Ltd, Sandhar Technologies Ltd. and Bharat Forge Ltd are the local companies which are already supplying parts to Tesla.
Chief Executive Officer Elon Musk had said back in July that his company is very likely to set up a factory in India.
Exorbitant Import Duty
Tesla is presently urging the government to lower import duties which would allow the company to enter India- one of the world’s biggest emerging car markets.
India levies an import duty of 100% on fully-built imported cars, including electric vehicles.
The government is considering a proposal to lower the taxes to 40% after Tesla’s appeals.
Meeting Between Tesla And Supplier Union
In another relevant development, a meeting had taken place recently between Tesla representatives in India and the Automotive Component Manufacturers Association of India (ACMA).
The Indian Tesla representatives include Tesla India’s head of policy and development, Manuj Khurana and a senior executive from global strategic sourcing and supply chain at Tesla Inc.
One of the topics discussed was the sourcing of critical parts.
What Will Convince Tesla To Come To India?
Former ACMA president Deepak Jain said that domestic auto parts makers want Tesla’s entry to be beneficial for them as well.
One way that could happen is if it begins production locally.
On the other hand, Musk said whether it will open a factory here is dependent on market acceptance which it can gauge through a soft launch of its foreign made cars here.