Tesla Launches $70,000 Model Y in India Amid High Import Tariffs

Tesla has entered the Indian market with its electric SUV, the Tesla Model Y RWD, at $70,000, as per Reuters. Tesla is expected to begin deliveries in the third quarter, aiming at a niche EV segment that makes up only 4% of total car sales in India. 

The company launched its first showroom in Mumbai on Tuesday. It will compete with German luxury cars like BMW and Mercedes-Benz rather than local EV manufacturers like Tata Motors and Mahindra. 

High Tariffs Drive Up Tesla SUV Price in India

India’s current import duty structure makes it difficult for international automakers to offer competitive pricing, and Tesla is no exception. As the Model Y will be an imported electric SUV, it falls under the 100% customs duty bracket. This has pushed Tesla’s SUV price in India far above what it costs in global markets like the US and China. 

The Model Y RWD version is Tesla’s entry-level variant in India. It offers an impressive range of over 590 km (as per the CLTC cycle) and goes from 0 to 100 kmph in just 5.9 seconds. While the features are on par with global offerings, the pricing may limit its reach to only a premium customer segment in India. 

First Tesla Showroom in India Set for Mumbai

Tesla has opened its first showroom in India at the Bandra Kurla Complex, Mumbai (BKC). The EV giant has also hired a local team to support its operations and customer service in India. 

The automaker is expected to set up service centers and charging infrastructure in key cities as it expands. Bengaluru, Delhi, and Hyderabad are also on Tesla’s radar for future showrooms and support hubs. 

Tesla’s India Strategy: Local Manufacturing on Hold?

While Tesla has launched in India with imported units for now, its long-term plans may depend on policy changes. The company had previously requested the Indian government to lower import duties for electric vehicles to test the market before investing in local manufacturing. However, no concessions were granted. 

Without a clear roadmap for lower tariffs or incentives, Tesla is choosing to import a limited number of units rather than build a plant. Talks of Tesla’s Gigafactory in India have slowed down, although they have not been ruled out entirely. 

Will India Buy a $70,000 Tesla?

Despite the buzz, the real question is whether Indian consumers will be willing to pay a premium for Tesla’s Model Y RWD. Luxury EV buyers have more options now, with brands like BMW, Audi, and Mercedes already offering electric SUVs. Tesla’s brand value and technology edge might attract early adopters, but large-scale success will likely need a shift in government policy. 

Until then, Tesla’s India journey will remain limited to a niche market of buyers willing to shell out top dollar for cutting-edge technology, backed by Elon Musk’s global brand appeal.