Athira Sethu
Kochi, 21 June 2025
Tesla is set to formally enter the Indian market this July by opening its first Mumbai and New Delhi showrooms. It will open its first retail outlet in mid-July in Mumbai, with the second opening in the capital shortly thereafter, a Bloomberg report said. This follows at a time when Tesla is seeking to expand into new markets following declining sales in Europe and China.
To start its operations, Tesla has received a small shipment of Model Y electric SUVs from its Shanghai factory in China. The vehicles are rear-wheel drive models, which are among the top-selling models globally for Tesla. Besides the vehicles, the firm has also shipped in fast-charging Supercharger units, accessories, branded merchandise, and spare parts from China, the United States, and the Netherlands.
One of the five imported Model Y cars costs around ₹2.77 million ($31,988) each. But India’s high import duty brings the price much higher. Since the cars are priced below $40,000, they come under India’s 70% import duty, along with additional fees. Therefore, the actual price of these cars in India will come out to be more than $56,000 before taxes and insurance are added. For comparison, the same vehicle costs $44,990 in the US, and retails for $37,490 after tax credits. This huge price disparity could be an issue in India, where high-end cars comprise just a fraction of total car sales.
Electric cars are gradually gaining traction in India, though they constitute only about 5% of new car sales. Tesla’s expensive prices may make it increasingly difficult to sell many cars in a highly price-sensitive market. Nevertheless, the firm seems intent on sticking around and growing, perhaps selling additional models in the future.
Now, Tesla does not have any head for its Indian operations following Prashanth Menon’s exit. However, the firm is recruiting staff in charging network, sales operations, and interacting with the government.
India’s government claims Tesla has not expressed interest in setting up a factory here and is interested only in selling imported cars. Tesla participated in the initial round of discussions for India’s plans to manufacture EVs but missed subsequent meetings, indicating minimal interest in domestic manufacturing.
Tesla is also establishing warehouses and storage facilities in Karnataka and around New Delhi in order to handle logistics and support services as it establishes a presence in India.
