Tesla To Source $1.7 Bn-$1.9 Bn Worth Of Components From India In 2023: Piyush Goyal

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Electric vehicle (EV) manufacturer Tesla plans to source components worth $1.7 Bn to $1.9 Bn this year from local vendors after buying $1 Bn worth of components last year.

“…Tesla already last year bought $1 Bn of components from all of you sitting here. I have a list of companies who supplied to Tesla. This year their target is nearly $ 1.7 bn or $ 1.9 bn…,” said Union Commerce Minister Piyush Goyal while addressing the 63rd annual session of the Automobile Component Manufacturers Association of India.

The comments come at a time when Tesla has been putting together plans to establish a manufacturing facility in India. Senior executives of the company met Goyal last month to discuss plans to set up a plant that would produce low-cost EVs in the sub-$24,000 range. 

Another major takeaway of his speech was that the government plans to formulate a new policy to attract EV global players and spur investment in the auto sector. Goyal also said that the Centre will hold discussions with relevant stakeholders before coming up with the policy. 

“As we get large-scale production, we will start enjoying the fruits of economies of scale of new technologies,” added Goyal.

This comes nearly a month after reports emerged that Indian authorities were working on an EV policy that could offer rebates on import taxes for EV manufacturers that shift source some of their manufacturing to India.

Commenting on global automakers’ contention that they bring investments to India, Goyal retorted by saying that investments come to the country because of its market size. He further added that bringing investments to the country does not mean that companies continue to ‘import goods into India that are available locally at a competitive price and of very high quality’.

Goyal also flagged the practice employed by some companies that route their investments from one nation and import components and inputs from other countries that are ‘not very’ friendly to India. He noted that the country may take a relook at components coming from other countries at zero duty under the free trade agreement. 

Overall, Tesla’s bid to nearly double components sourced from India this year points to its India plans that are currently afoot. Last month, reports emerged that the carmarker had leased a 5,850 sq. ft. office space in Pune.

With talks ongoing with the union government, Tesla is also looking to cash-in on the attractive production-linked-incentives (PLIs) to diversify its production away from China and establish a base in the country. 

While Tesla wants to bring some of its Chinese vendors to India, the Centre has directed the carmaker to ask its vendors to sign joint ventures (JVs) with Indian partners to get the requisite clearances.

Alongside, the Centre and state governments have left no stone unturned to spur the adoption of EVs and attract global EV automakers to the country. From the FAME-II scheme to fast tracking land acquisition, authorities have been rolling out a red carpet for EV players. 

Amid a plethora of options and hectic marketing efforts by both domestic and international manufacturers, more and more people have jumped on the EV bandwagon even as the allied EV infrastructure continues to be built up from ground. 

This has resulted in the emergence of local players such as Ola Electric and Ather, largely in the two-wheeler EV segment. On the other hand, international companies including MG Motor, Renault SA, Nissan and Volkswagen continue to expand their operations in the country.

As per reports, the homegrown EV market was pegged at $3.21 Bn in 2022 and is projected to grow to a size of $113.99 Bn by 2029.

The post Tesla To Source $1.7 Bn-$1.9 Bn Worth Of Components From India In 2023: Piyush Goyal appeared first on Inc42 Media.

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We StartupNews.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.

Sarthak Luthra
Sarthak Luthra
Hey, there! I am the tech guy. I get things running around here and I post sometimes. ~ naam toh suna hi hoga, ab kaam bhi dekhlo :-)

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Tesla To Source $1.7 Bn-$1.9 Bn Worth Of Components From India In 2023: Piyush Goyal

Electric vehicle (EV) manufacturer Tesla plans to source components worth $1.7 Bn to $1.9 Bn this year from local vendors after buying $1 Bn worth of components last year.

“…Tesla already last year bought $1 Bn of components from all of you sitting here. I have a list of companies who supplied to Tesla. This year their target is nearly $ 1.7 bn or $ 1.9 bn…,” said Union Commerce Minister Piyush Goyal while addressing the 63rd annual session of the Automobile Component Manufacturers Association of India.

The comments come at a time when Tesla has been putting together plans to establish a manufacturing facility in India. Senior executives of the company met Goyal last month to discuss plans to set up a plant that would produce low-cost EVs in the sub-$24,000 range. 

Another major takeaway of his speech was that the government plans to formulate a new policy to attract EV global players and spur investment in the auto sector. Goyal also said that the Centre will hold discussions with relevant stakeholders before coming up with the policy. 

“As we get large-scale production, we will start enjoying the fruits of economies of scale of new technologies,” added Goyal.

This comes nearly a month after reports emerged that Indian authorities were working on an EV policy that could offer rebates on import taxes for EV manufacturers that shift source some of their manufacturing to India.

Commenting on global automakers’ contention that they bring investments to India, Goyal retorted by saying that investments come to the country because of its market size. He further added that bringing investments to the country does not mean that companies continue to ‘import goods into India that are available locally at a competitive price and of very high quality’.

Goyal also flagged the practice employed by some companies that route their investments from one nation and import components and inputs from other countries that are ‘not very’ friendly to India. He noted that the country may take a relook at components coming from other countries at zero duty under the free trade agreement. 

Overall, Tesla’s bid to nearly double components sourced from India this year points to its India plans that are currently afoot. Last month, reports emerged that the carmarker had leased a 5,850 sq. ft. office space in Pune.

With talks ongoing with the union government, Tesla is also looking to cash-in on the attractive production-linked-incentives (PLIs) to diversify its production away from China and establish a base in the country. 

While Tesla wants to bring some of its Chinese vendors to India, the Centre has directed the carmaker to ask its vendors to sign joint ventures (JVs) with Indian partners to get the requisite clearances.

Alongside, the Centre and state governments have left no stone unturned to spur the adoption of EVs and attract global EV automakers to the country. From the FAME-II scheme to fast tracking land acquisition, authorities have been rolling out a red carpet for EV players. 

Amid a plethora of options and hectic marketing efforts by both domestic and international manufacturers, more and more people have jumped on the EV bandwagon even as the allied EV infrastructure continues to be built up from ground. 

This has resulted in the emergence of local players such as Ola Electric and Ather, largely in the two-wheeler EV segment. On the other hand, international companies including MG Motor, Renault SA, Nissan and Volkswagen continue to expand their operations in the country.

As per reports, the homegrown EV market was pegged at $3.21 Bn in 2022 and is projected to grow to a size of $113.99 Bn by 2029.

The post Tesla To Source $1.7 Bn-$1.9 Bn Worth Of Components From India In 2023: Piyush Goyal appeared first on Inc42 Media.

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We StartupNews.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.

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Sarthak Luthra
Sarthak Luthra
Hey, there! I am the tech guy. I get things running around here and I post sometimes. ~ naam toh suna hi hoga, ab kaam bhi dekhlo :-)

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