4 Ways To Ensure That Indians Can Own Tesla Cars
Tesla Inc Chief Executive Elon Musk, on July 8, tweeted pictures of the first Model 3 sedan that is rolling off the assembly line at Fremont, California, United States. One of the most anticipated cars from the American car manufacturer, the all-electric sedan shares most of its design and style cues with the Tesla's flagship sedan, the Model S. It may be recalled that before the unveiling, Musk had also tweeted about the major markets where new $35,000 car will be sold with China and the US topping the list. However, launching in India could be a dicey proposition as inadequate infrastructure (charging stations) and higher import duties on CBUs may be the biggest stumbling blocks. BW Businessworld finds out why.
Sohinder Gill, Director Corporate Affairs, Society of Manufacturers of Electric Vehicles (SMEV) stated, "Tesla needs to see what is suitable for India and what the customers would buy even if given a free choice. So if Tesla comes with the intention of setting up charging points in the country, it will have a positive impact on the automotive industry. Leaving aside their sales of about a few hundred cars, India is not ready for big volumes."
He further added, "In fact, India is not ready for any electric car of either B or C segment. This is because it would cost three times the normal cars and the govt is not going to subsidise unless there is a Make-in-India initiative behind it. Therefore, an exorbitant import duty has to be imposed on fully imported cars. So what is required is mass transportation like e-ricks, taxis and buses. For example, Indian cab aggregator Ola is planning to have 1,000 e-taxis in its fleet."
While Tesla has yet not been launched in India, it has already it caught the fancy of super rich people like GOQii's Vishal Gondal, Paytm's Vijay Shekhar Sharma and venture capitalist Mahesh Murthy. However, its launch here has been delayed due to sourcing issues in the country as Musk, in a tweet, mentioned that the launch of Tesla Model 3 Sedan in India will be delayed, owing to strict local sourcing guidelines and supply issues. According to the country's FDI policy, it is mandated that any company aiming to set up retail location, must sell at least 30 per cent of the locally sourced goods.
So if Tesla pulls out or postpones its foray into India, it will definitely not augur well for the government's vision of having an all-electric vehicle car fleet by 2030. Even though their numbers would be in a few hundred, their presence can literally galvanise the e-vehicle industry in the country.
So what can perk up car sales and the total e-vehicle industry in India?
To make it work for India, the following are the measures that are necessary to be implemented such as a) Incentivize buyers to go for electric cars b) Make electric cars available across various segments beginning from entry-level segment to premium and luxury segment c) Make Charging more convenient by setting up various points across the country d) subsidize batteries to bring economies of scale.
