Satara on Tesla’s Radar for Next Assembly Hub

According to reports, EV powerhouse Tesla is getting closer to entering India by establishing an assembly plant in Satara, Maharashtra. According to a media report, the Elon Musk-led company plans to establish a completely knocked down (CKD) plant to assist in controlling the import duties on its components.

CKDs are assembly plants that enable local assembly capabilities for a business by shipping all of the various completed components of a car from various locations. This comes a few months after it was revealed that the Andhra Pradesh government has been working tirelessly to get the multinational EV manufacturer to invest by offering incentives and that its economic development board had even produced a pitch for the purpose.

However, the attempts appear to have failed. According to the aforementioned article, which cited a source, Tesla was in negotiations with Megha Engineering, a company based in Hyderabad, and other businesses to purchase property in a joint venture for its CKD initiatives. However, the talks were unable to proceed.

Tesla to Launch EV by Last Quarter of Current Fiscal Year

By the end of the current fiscal year, it is anticipated that Tesla will be able to introduce its own constructed EVs. The development coincides with the resignation of Prashanth Menon, the leader of Tesla's India division.

According to additional reports, Menon has called for his resignation for personal reasons. It was previously reported that Tesla had received land offers from the state of Maharashtra in places like Chakan and Chikhalin, which are close to Pune. With domestic companies like Mahindra and Tata Motors operating there, Chakan is regarded as a centre for Indian automakers. Cooper Corporations, a supplier of vehicle components, is also based in Satara.

Tamil Nadu and Gujarat were among the other states vying to host Tesla's manufacturing facility. The amount of land that Tesla will purchase for its assembly plant project is currently unknown.

Tesla has already decided on locations for its shops in Delhi and Mumbai. It has also signed an agreement with EFC, a coworking space organisation, to lease a 30-seat office space in Mumbai's Bandra-Kurla Complex (BKC) for INR 3 lakh per month. On its website, Tesla states that it is also seeking Indians for a minimum of thirty different roles.

India’s New EV Policy Providing Favourable Business Environment to Tesla

The country's new EV regulation has made it more conducive to Tesla's commercial success, and the company's efforts to enter India have accelerated. According to a new regulation that was implemented in March of last year, businesses who agree to establish manufacturing facilities in the nation will be required to pay a reduced charge on EV imports.

According to the proposal, companies that agree to invest at least INR 4,150 Cr (about $500 Mn) in India to establish manufacturing facilities will have their import duties on vehicles with a cost, insurance and freight (CIF) value of $35,000 or more lowered by 15% for five years.

 In an effort to draw in foreign investment, India is also seeking to lower import taxes on 35 components needed in the production of EV batteries.