New Delhi: Tesla has urged the office of Prime Minister Narendra Modi to cut import taxes on electric vehicles before entering the market, four sources told Reuters, demanding demands that faced objections from several Indian car makers.
Tesla wants to start selling imported cars in India this year but said taxes in this country are among the highest in the world.
The request for tax cuts – was first reported by Reuters in July – encouraging objections from several local players, who said such a move would hinder investment in domestic manufacture.
Tesla’s executive, including his head policy in India, Manuj Khurana, took the company’s demands to Modi officials last month in a closed meeting, on the grounds that taxes were too high, four sources were familiar with the discussion.
During the meeting at the Modi office, Tesla said that the structure of the Indian task would not make its business in the country “a decent proposition”, according to one source.
India imprisoned 60% import duties on electric vehicles that cost $ 40,000 or less, and the assignment is 100% at a price of more than $ 40,000.
Analysts have said that at this level Tesla’s car will be too expensive for buyers and can limit their sales.
Tesla separately also submitted a meeting request between Elon Musk and Modi’s chief executive, three sources said.
Office and Tesla Modi, and Khurana’s executive, did not respond to requests for comments.
It is not clear what the Modi Office recognizes to Tesla in response, but the four sources told Reuters, government officials were divided into the demands of US car makers.
Some officials want companies to commit to local manufacturing before considering import tax breaks.
Concerns about the impact on the local automotive industry also burden the government, the source added.
Indian companies such as Tata Motors, who recently collected $ 1 billion from investors including TPG to increase the production of EV locally, said that the Tesla concession would conflict with the Indian plan to encourage domestic EV creation.
One source, who has direct knowledge of government thinking, said: “If Tesla is the only EV maker, the declining task will work.
But there are others.” The Transport Minister said this month Tesla should not sell Chinese-made cars in India and must produce locally instead, but Tesla has indicated in advance to experiment with imports.
Musk said on Twitter in July that “if Tesla was able to succeed with vehicles imported, then a factory in India was very possible.” The Indian market for Premium EV is still in infany and its rare charging infrastructure.
Only 5,000 of the 2.4 million cars sold in India last year were electricity.
A government official said he lowered the task for a limited period of time to pave the way for Tesla entries to “improve the friendly image of Indian investors and green credentials” while also attracting more investment.