Elon Musk's Tesla may set up factory in India in 2024: Report

Elon Musk's electric car maker Tesla is reportedly just a few steps away from entering the Indian market as the firm might secure the deal in 2024.

Elon Musk's electric car company Tesla and the Indian government are likely to finalise their deal to bring the America-made vehicles to the country. According to reports, Tesla might enter the Indian market in 2024.

Prime Minister Narendra Modi shakes hands with Tesla chief executive Elon Musk during a meeting in New York City, (via REUTERS)

Bloomberg reported that India is inching closer to shaking hands with Tesla Inc, which would allow the US automaker to ship cars to the country. It is also expected that under this deal, Tesla would set up a factory in India in 2024.

The announcement regarding the deal can be made during the Vibrant Gujarat Global Summit in January 2024, said a source quoted by Bloomberg. Tesla is considering Maharashtra, Tamil Nadu and Gujarat to set up their electric vehicle (EV) factory.

Tesla is also expected to make an initial investment of USD 2 billion to set up shop in India, and would look to increase purchases of auto parts from the nation to as much as USD 15 billion, reported Bloomberg.

Apart from auto parts and shipping EVs, Tesla Inc is also planning to make some batteries in the country to bring down the costs. Tesla currently has factories set up in the US, China and Germany, and the Modi government's push for increasing EVs in India could lead to a major revenue boost for Elon Musk's firm.

India's electric vehicle market still remains low, with battery-powered cars accounting for just 1.3% of the total passenger vehicles sold last year.

While tariffs on importing Tesla vehicles to India can be exceptionally high, the prices could drop down to as low as ₹15 lakh if the vehicles are locally made.