Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal

Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal
Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal
Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal
Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal

Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal

Tesla Plans to Source $1.7-$1.9 Billion in Parts from India: Piyush Goyal

pic credit: mint

in a significant development, Tesla, the electric vehicle giant, is set to procure components valued between $1.7 billion and $1.9 billion from India, with a substantial $1 billion already in their possession. This announcement was made by India’s Minister of Commerce and Industry, Piyush Goyal, during an auto conference.

Tesla’s Increasing Investment in India

At the 63rd Annual Session of the Automobile Component Manufacturers Association of India, Minister Piyush Goyal highlighted Tesla’s growing engagement with the Indian market. He shared, “Tesla already last year bought $1 billion of components from all of you sitting here. This year, their target is nearly $1.7 billion or $1.9 billion.” This signifies Tesla’s commitment to strengthening its supply chain in India.

Potential Factory for Low-Cost Electric Vehicles Recent reports from Reuters suggest that senior Tesla executives held discussions with Indian authorities about establishing a factory in India. This facility would produce a low-cost electric vehicle priced at approximately $24,000, marking a 25% reduction compared to Tesla’s current entry-level model. This move aims to cater to both the Indian market and international exports.

Trade Dynamics and Steel Imports Minister Goyal also addressed trade dynamics related to the automotive industry. He mentioned the possibility of taking retaliatory actions against countries that restrict access to Indian steel companies while exporting steel to India. Goyal’s concern centered on some companies importing automotive steel from their home countries. India still relies on imports for approximately 20% of its automotive steel requirements.

Investments and Market Size The Minister emphasized that investments flow into India primarily because of its vast market size. He stressed that encouraging investments does not mean compromising on the availability of locally produced goods that are competitively priced and of high quality.

Challenges in International Trade Minister Goyal urged the industry to scrutinize products coming into India from other countries under free trade agreements. He highlighted the presence of non-tariff barriers created by certain countries, which restrict the entry of goods from other nations. These barriers, both explicit and implicit, pose challenges to international trade.

Focus on Quality and Skilling As part of India’s efforts to boost its manufacturing and industrial capabilities, the Ministry is introducing quality control norms for various products. Additionally, there is a strong focus on skill development, up skilling, and retraining of the workforce to enhance productivity and competitiveness.

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