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World's largest electric vehicle manufacturer Tesla is expected to finalise location for a new factory soon. Elon Musk, its CEO, said the location is likely to be finalised before the end of this year. On Tuesday, he hinted that the location for the new factory could be in India as he expressed interest in setting up business in the country. His remarks come almost a year after he dropped his plans to launch Tesla in India. The change of heart comes ahead of Prime Minister Narendra Modi's visit to India next month.
During an interview on Tuesday, where Musk was asked if Tesla was interested in India for the new factory, he replied, "Absolutely". Last week, Tesla executives met Indian officials for two days in New Delhi where the EV maker reportedly proposed to build a manufacturing facility and R&D centre in the country. Earlier, Union Minister Rajeev Chandrasekhar was quoted by news agency Reuters saying, "They are very seriously looking at India as a production and innovation base." However, reports claim that Tesla stopped just short of committing a factory in India during the meeting between its executives and government officials.
Earlier, the Centre had advised Tesla to set up a local manufacturing plant if it wanted to sell EVs in India. Union Minister Nitin Gadkari had said Tesla will be welcome to India if it manufactures EVs locally and not import them from China. Elon Musk had refused to take the offer saying, "Tesla will not put a manufacturing plant in any location where we are not allowed first to sell and service cars." Tesla did not repeat the plea during fresh talks with officials from the PMO.
Tesla's warming up to India again is seen as the EV maker's attempts to diversify beyond China, its largest market outside the US. Amid rising tension between the US and China, several carmakers, including Tesla, may be pushed to the point of finding new destination for EV business in future. Besides components, China is also key to global EV business for its battery manufacturing. India could be the alternative market where the government is eager to promote local manufacturing.