Home >Auto News >'India is not yet ready for EV infrastructure,' says an analyst on Tesla's entry

New Delhi: Even as American electric car major Tesla announced it is set to start its operations in India next year, an analyst said expectations of an electric vehicle (EV) boom in the country need to be tempered for a "good amount of time".

"Tesla's entry in India is a big thing as far as making India a global hub for manufacturing EVs. However, its proliferation is expected to take a good amount of time as neither Tesla nor India is ready for EV infrastructure. It will take establishing a wide network of vendors, software infrastructure, R&D, testing etc for its further development though the company is set for its Indian debut in 2021," said Ashwin Patil, Senior Research Analyst at LKP Securities.

The Road, Transport and Highways minister has been pushing for green fuel and electric vehicles for cutting India's huge 8 lakh crore crude imports.

Tesla Inc. co-founder and chief executive Elon Musk had in October said the company will enter the Indian market in 2021.

"American auto major Tesla will have its distribution facility (sale centres) for its cars in India from next year and considering the demand it would look into setting up of manufacturing here. India has the potential to become the largest EV (electric vehicle) producer in the world in the next five years," Gadkari told PTI.

Pricing of the Tesla vehicle will not be a threat to the existing automakers, said Patil.

"Tesla is planning to enter India through a launch of its Model 3 which will range up to 55 lakh, thus causing no threat to any of the domestic OEMs initially. Later on, definitely, there will be an EV revolution in India over a period of time, but again affordability may act as a dampener from the customer's point of view. Therefore battery pricing will play a major role in the overall pricing of the EV. We are also unsure of the mode of manufacturing at this point in time. However, it's good news from the domestic investment and economic state of the country," said Patil.

With India's pledge to reduce carbon emissions by 30-35 per cent by 2030 and efforts to cut down on 8 lakh crore-worth crude oil imports, the focus is also on green fuel and electricity as well as EVs, Gadkari said.

Stressing that India is power surplus, Gadkari said the benefits of e-mobility solutions are immense here.

"The Centre intends to have an electric vehicle sales penetration of 30 per cent for private cars, 70 per cent for commercial cars, 40 per cent for buses, and 80 per cent for two and three-wheelers by 2030 by providing various incentives, which are likely to drive the growth of EV market in India," Gadkari said.

Also, the government is planning to set up at least one e-charging kiosk at each of the around 69,000 petrol pumps across the country with an aim to accelerate the uptake of EVs, he added.

Gadkari said it was an opportune time to harbour the ambition of becoming number one in EVs as raw material and skilled manpower was available in India, making it a "win-win situation".

In October this year, Musk had said "next year for sure," while replying to a query on Tesla's India plans on Twitter.

Earlier, the Maharashtra government had said it is looking for potential investment from Tesla in the state and has held discussions with the company.

Maharashtra is already home to a host of domestic and foreign automobile manufacturers with Chakan Industrial belt near Pune a major automobile hub in the state.

With PTI inputs

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