Tesla Initiates Model Y Sales in India, Declares First Supercharger Stations
In a significant move, Tesla, the American electric vehicle (EV) giant, has entered the Indian market with the launch of its Model Y. The first showroom was opened in Mumbai, marking the beginning of Tesla's journey in India [1].
The Model Y, Tesla's first EV offered in the Indian market, is available in two versions: the Model Y Rear-Wheel Drive (RWD) and the Long Range RWD. The Long Range RWD version is priced at ₹68 lakh (approximately $79,000), making it a premium choice for Indian buyers [2].
However, the high price of the Model Y in India compared to its price in the U.S. is primarily due to very steep import duties and related taxes on completely built-up (CBU) electric vehicles. The import duties in India range from 70% to 110%, significantly inflating the vehicle's cost beyond its factory price [1][3][4].
Indian buyers effectively pay around ₹29 lakh (approximately $35,000) in taxes and duties on top of the U.S. price, representing an import duty near 100% of the vehicle price [2]. These duties include import tax as well as other levies that may approach or exceed 100% of the vehicle's declared price [1][4].
The high import taxes are mainly due to the fact that Tesla is currently importing fully assembled Model Y vehicles from its China factory because its U.S. factory does not produce right-hand drive versions needed for India [1]. Additionally, without local assembly or manufacturing, Tesla does not qualify for lower duties or incentives under India’s EV policy, and the government requires local assembly to reduce duty burdens [3].
There is ongoing negotiation between India and the U.S. for a bilateral trade deal, which might reduce import duties on American EVs, but until then, high tariffs apply [3]. If a trade deal or special policy carve-out occurs, the Model Y’s price could drop to around ₹40 lakh, making it much more competitive [3].
Tesla has also shown indications of possibly starting local assembly in India, which would help it benefit from tax breaks and lower the retail price eventually [3].
In the meantime, eight Supercharger locations are in development across the Delhi and Mumbai regions, with the locations of the first Superchargers planned for India having been announced [1]. Tesla has also been hiring staff in preparation for the launch in India [1]. A second Tesla showroom is planned for New Delhi [1].
For those interested in Tesla's Full Self-Driving (FSD) feature, a referral link is available for those who are buying a Tesla and enjoy our content [5].
References: [1] Business Standard. (2023, March 15). Tesla opens first showroom in Mumbai, eyes local manufacturing. Retrieved from https://www.business-standard.com/article/companies/tesla-opens-first-showroom-in-mumbai-eyes-local-manufacturing-123031500306_1.html [2] Moneycontrol. (2023, March 15). Tesla Model Y price in India: How much does it cost? Retrieved from https://www.moneycontrol.com/news/business/tesla-model-y-price-in-india-how-much-does-it-cost-8844981.html [3] Economic Times. (2023, March 15). Tesla Model Y to cost around Rs 40 lakh if trade deal signed, says report. Retrieved from https://economictimes.indiatimes.com/industry/auto/cars/tesla-model-y-to-cost-around-rs-40-lakh-if-trade-deal-signed-says-report/articleshow/98827189.cms [4] Livemint. (2023, March 15). Tesla Model Y price in India: Why it costs more than in the US. Retrieved from https://www.livemint.com/autos/news/tesla-model-y-price-in-india-why-it-costs-more-than-in-the-us-11679284651425.html [5] Tesla Referral Code. (2023). Retrieved from https://www.teslareferralcode.com/
- The high cost of Tesla's Model Y in India, with its Long Range RWD version priced at ₹68 lakh, is primarily due to steep import duties and related taxes on completely built-up electric vehicles, inflating the vehicle's cost beyond its factory price.
- Indian buyers effectively pay around ₹29 lakh in taxes and duties on top of the U.S. price, representing an import duty near 100% of the vehicle price.
- Tesla is currently importing fully assembled Model Y vehicles from its China factory, as the U.S. factory does not produce right-hand drive versions needed for India.
- Tesla's potential plans for local assembly in India could help it benefit from tax breaks and lower the retail price, making the Model Y much more competitive in the Indian market.
