Tesla (TSLA) incorporates Indian company amid rumors of a local factory

Tesla (TSLA) incorporates Indian company amid rumors of a local factory

Tesla has incorporated a new Indian business unit ahead of an upcoming launch in the important South Asian market.

There are also rumors of Tesla building a factory in India.

Tesla and India

Tesla had a long history of flirting with the idea of entering the Indian market.

In 2016, CEO Elon Musk said that Tesla had plans to enter the Indian market, but those plans have been delayed.

Jay Vijayan, who was then Tesla’s chief information officer and was born in India, went to the country to investigate the possibility of Tesla starting to import cars in India.

After that, there was some confusion over Tesla’s ability to even import its vehicles in India in 2016.

At the time, Musk expressed concerns about local regulations forcing foreign retailers to source 30% of their parts locally that could prevent a launch.

The commerce and industry ministry responded to Musk telling him that he was wrong, but they actually assumed that Tesla would open a factory in India in order to sell cars in the country, but like almost all markets outside the US, Tesla first planned to import vehicles.

In 2019, Tesla was rumored to be showing interest in a battery factory project in India, but nothing never happened.

Now it’s finally happening

Over the last few months, there have been more rumors of Tesla looking to establish manufacturing and/or research and development in India.

Local government officials have revealed about talks with Tesla executives.

But now we finally learn about more than talks and rumors. Tesla has officially incorporated a business in India.

Money Control reports:

The unit named Tesla India Motors and Energy Private Ltd was incorporated in Bengaluru on January 8, and Vaibhav Taneja, Venkatrangam Sreeram, and David Jon Feinstein have been named as directors, according to disclosures with the corporate affairs ministry.

Recently, Elon Musk confirmed that Tesla plans to finally enter the Indian market in 2021.

However, it’s unclear if the automaker still needs to establish local manufacturing in order to sell cars without extremely high import duties, which was previously preventing them from making the move.

Either way, there are now again talks that Tesla is looking to invest into building a factory in India.

The Karnataka government has reportedly already proposed a list of locations, including one in Tumkur,  a major industrial city located in the southern part of Karnataka, to build a factory.

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