In Tesla snub to India, Elon Musk says 'no plant before selling cars'

Tesla's second Asian Gigafactory will not come up in India. Tesla CEO Elon Musk, in his clearest hint yet, has snubbed India as the potential location to launch his electric vehicle business. He took to Twitter to announce that Tesla will not set up any facility in a country that does not allow sale of its cars. In a recent report by news agency Reuters, Tesla has shoved its plans to come to India after ‘failing to secure lower import taxes’.

According to reports, Tesla is likely to finalise Indonesia as its second EV manufacturing hub in Asia after Shanghai, China. Tesla has been looking for a location to set up its second Gigafactory in the continent for some time. The US-based EV maker has been in talks with the Centre for the past couple of years to seek lower import duties on imported cars before making any commitment to set up its facility in India.

On Friday, Elon Musk wrote, "Tesla will not put a manufacturing plant in any location where we are not allowed first to sell and service cars." Earlier in January, Musk had said Tesla was "still working through a lot of challenges with the government" to push for sales of its products in India.

Union Minister Nitin Gadkari had earlier invited Tesla to launch its electric cars in India. However, the invite had come with conditions that the EV maker should share its manufacturing plans for the country before expecting any leniency on tax front.Gadkari had said, “If Elon Musk is ready to manufacture a Tesla in India, there is no problem. We have got all competencies, the vendors are available. We have got all types of technology and because of that, he can reduce the cost."

"He is welcome in India. We don't have any problem, but, suppose, he wants to manufacture in China and sell in India, it cannot be a good proposition for India. Our request to him is, come to India and manufacture here," the minister had said.

In 2020, Tesla had formally registered itself in India through a subsidiary called Tesla India Motors And Energy Private Limited. The future of this unit now remains uncertain.