Elon Musk’s Tesla pulls back on India push, officials cool hopes as EV maker faces global pressures, says report

India does not expect Tesla to invest in the country as Elon Musk's executives have stopped contacting officials, Bloomberg reported. The country is now focusing on domestic automakers for EV production.

Livemint
Updated5 Jul 2024, 07:59 AM IST
File image of Tesla Inc CEO Elon Musk at a car launch in Shanghai, China
File image of Tesla Inc CEO Elon Musk at a car launch in Shanghai, China(Reuters / Aly Song)

Indian officials have cooled hopes of a Tesla production unit in the country as executives of the Elon Musk-led electric vehicle maker have stopped contacting them, Bloomberg reported.

The country no longer expects Tesla to move forward with an investment as Musk's teams has not followed up on inquiries with officials in New Delhi, the report said, citing sources familiar with the matter. The pull back comes months after Musk postponed his April visit to India, the sources added.

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The Indian government has been made aware of Tesla's financial issues, they said, adding that the EV-maker has no plans to funnel fresh funds into India.

Tesla and officials from the Union Ministry of Heavy Industries did not respond to queries, according to the Bloomberg report.

Tesla Facing Global Pressures, Challenges in China

The development comes as Tesla recorded a second consecutive drop in global deliveries this quarter, and faces increased competition in China.

In April, Musk announced job cuts, the automaker has seen sales of its flagship Cybertruck stall, and its Mexico plant construction delayed.

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Musk also cancelled a visit to India that was supposed to include a meeting with Prime Minister Narendra Modi in April. The billionaire claimed “pressing issues” at work kept him away, but was seen in Vietnam weeks later.

India Turns to Domestic Automakers to Plug Demand

Meanwhile, the Indian government seems to have turned its hopes for boosted EV production towards domestic players such as Mahindra & Mahindra and Tata Motors, sources said.

Should Musk decide to re-engage, Tesla would still be welcome to avail itself of the new import tax policy, Indian officials said.

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India’s EV market is in its initial stages, with battery-powered cars accounting for just 1.3 per cent of the total in 2023, as per BloombergNEF. Many buyers are hesitant to make the switch due to the high upfront costs for EVs and a dearth of charging stations.

(With inputs from Bloomberg)

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First Published:5 Jul 2024, 07:59 AM IST
HomeCompaniesNewsElon Musk’s Tesla pulls back on India push, officials cool hopes as EV maker faces global pressures, says report

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