Tesla CEO Elon Musk recently said that the launch of the much anticipated Model 3 car in India will be delayed. This has understandably caused disappointment to many of Indian tech entrepreneurs and executives who have signed up to buy the iconic vehicle.
Tax and Regulatory Issues
There have been many people who have coughed up to nearly $1000 on pre-bookings itself. However, an imported Model 3 car is expected to be priced more than double its original selling price in the USA – which is approximately $35, 000 or around Rs 22,61,525. This increase in cost is mostly attributed to the Goods and Service Tax which is going to be enforced from 1st July onwards.
Musk had earlier tweeted that his company may have to put on hold its launch plans in India due to the absence of an ecosystem for the supply of electric vehicle components. Musk believes that that 30% of the parts must be locally sourced as per Indian laws while making this product. The supply does not yet exist in India to support such requirements.
However, the Make in India’ Twitter handle, clarified to Musk the next day that the foreign direct investment (FDI) policy does not mandate any such minimum sourcing of components.
Even then, it seems highly unlikely that Elon Musk and Tesla Inc will take a more permanent stand until India develops sufficient infrastructure for its vehicles.
The Model 3 is one of the 4 models of electric and futuristic cars that have been launched by tesla Inc. It was originally codenamed Tesla BlueStar, and is expected to start shipping in other countries sometime in 2018.