Import Duties in India Will Make Tesla Cars 'Unaffordable', Says Elon Musk

India was on Tesla's radar when they introduced the Model 3 to the world in 2016, bringing the possibility of seeing the electric car running on Indian roads closer to reality. However, while Musk has always seemed optimistic to queries regarding Tesla's foray into the Indian market, a recent Tweet by one Yashwanth Reddy, inquiring the same seems to have been met with a skeptical answer by Musk.

Taking to Twitter, Yashwanth Reddy asked, "Sir, when will the Tesla cars enter in the Indian market?" to which Elon Musk answered, "I'm told import duties are extremely high (up to 100%), even for electric cars. This would make our cars unaffordable."

This more or less drives the nail on the coffin for any possibility of Tesla cars making it to the Indian market. According to an NDTV report, any car costing over INR 27 lakh, the import duty applied in 100 per cent. For anything less than that, the import duty is 60 per cent. The cheapest Tesla, Model 3, which costs close to INR 20- 25 lakh in global markets will attract a 60 per cent import duty and will thus be an expensive purchase in India.

However, there seems to be a light at the end of the tunnel here. Replying to the thread Tesla Club India informed that while importing won’t make sense considered the import duties, “having a small vehicle assembly plant can help. Import just 10-15%. And govt recently reduced GST on EV from 12% to 5% and on chargers also from 18% to 5%.”

Replying to Tesla Club India, Musk revealed that ‘recent changes in sales tax give hope for future changes.’ He wrote, “For other countries, we pay in part for the local factory by selling cars there ahead of time. Also, gives a sense of demand. Current rules in India prevent that, but recent changes in sales tax give hope for future changes.”

Notably, Tesla has been trying to enter the Indian market since 2017, but to no avail.