Tesla-Exclusive suspends plans in India amid stalemate over sourcing-tariffs

by Aditi Shah

NEW DELHI, MAY 13 (Reuters) – Tesla has postponed plans to sell electric vehicles in India, abandoning site searches and reassigning some of its staff there after failing to secure lower rates, three sources familiar with the matter told Reuters.

The move ends more than a year of deadlocked discussions with Indian government officials, with Tesla first seeking to test demand by selling electric vehicles imported from its production hubs in the United States and China at lower tariffs.

But the Indian government is pushing Tesla to commit to local manufacturing before lowering import duties, which can be as high as 100% on imported vehicles.

Tesla has postponed plans to import cars into India after Prime Minister Narendra Modi’s government offered no concessions when it presented its budget and fiscal policy on February 1, the sources added.

Tesla and a spokesman for the Indian government did not immediately respond to requests for comment.

For months, Tesla had been looking for places to open showrooms and service centers in the cities of New Delhi, Bombay and Bangalore, but that project was also put on hold, the two sources said.

Tesla has also assigned additional responsibilities in other markets to certain members of its local team. India’s policy and development manager, Manuj Khurana, has had product responsibility for San Francisco since March, his LinkedIn profile shows.

Narendra Modi has sought to lure manufacturers as part of his “Make in India” campaign, but his transport minister, Nitin Gadkari, said in April that it was not a “good proposition” for Tesla to import cars from China in India. (Contributed by Aditya Kalra; French version of Elena Vardon, spoken by Kate Entringer)

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