Tesla To DLF: Find Me Showroom Space For Delhi Dealership

Tesla seems to have restarted thinking about an India entry. The latest reports from Reuters suggest that Elon Musk’s EV company is currently searching for a showroom space in New Delhi- and could be in talks with DLF for the same. This could be taken as the first sign on an upcoming entry announcement.

Tesla’s India Entry: Looking Back

Rumours and reports about Tesla’s India debut had made huge headlines earlier this year. The company was known to be applying for trademarks and searching for dealership spaces. Musk was even said to have plans to visit India, for having in-person discussions with the Prime Minister.

However, things took a turn in April-July as the company sacked 10% of its employees owing to a steep decline in sales. This meant that Musk would soon stop responding and put the $2-3 billion India investment plan on hold. Tesla was struggling with sales globally and the competition was fierce in the Chinese market. With the plans on hold, Musk called off his India visit.

Tesla’s India Entry: The Present Day

Reuters reports that the carmaker has resumed its search for a dealership space in India. It is reportedly in early-stage talks with DLF to find one in the capital city. Neither DLF nor Tesla has confirmed the claim or responded to the report. However, Reuters claims the information to be from trustworthy sources. DLF, for those who are unaware, is India’s biggest property developer and real estate giant. This could thus be two giants joining hands to bring something aspirational to the Indian market.

A source reportedly told Reuters that the EV giant is looking for 3,000 to 5,000 square feet of real estate to build its experience centre. The delivery and service areas are said to be five times larger. Tesla is said to be considering DLF’s Avenue Mall in southern Delhi and the Cyber Hub office and retail complex in Gurugram city, as per sources. Even with all these said, it is important to mention that Tesla’s search is still “exploratory” and nothing has been finalised yet.

Tesla India’s Import Plans

Tesla will take the import route initially. It is, however, unclear at the moment, if the EV maker would consider importing vehicles at the 100% tax rate or will go with investment commitments with the Indian government to qualify for the lower 15% slab. Taking the latter route would make it possible for Tesla to price its products competitively. A competitive pricing would be critical for the manufacturer to find success in the Indian market. The competition here is growing more fierce every day.

Tesla was previously not ok with the high import duties and had requested the government for relaxations. Following the same, the government even considered policy amendments that would bring about a more hospitable duty structure. This, they thought, would attract investments from other automakers like Hyundai and Toyota as well.

India’s EV Market And The Government’s Vision

Unlike some first-world countries, the EV market in India is rather small, making up for just around 2% of the total cars and SUVs sold here. Quoting 2023 numbers, 4 million cars and SUVs were sold in the country, of which just 2% were all-electric. The government, however, wants to boost EV sales and increase their market share to 30% by 2030. It might thus make policy amendments in favour of Tesla and other EV players in the days ahead.

Starlink Coming To India?

Along with Tesla, Elon Musk’s Starlink is also rumoured to be considering an entry into the Indian market. It is said to have won the lobbying battle against Mukesh Ambani and JIO, and New Delhi could soon allocate spectrum for Starlink services as well.