Speculation mounts on Tesla’s entry to India as it posts first job openings
Tesla plans to launch operations in India, eyeing showrooms in Mumbai and Delhi, amid job openings and discussions on dealership models.
Less than a week after Prime Minister Narendra Modi met SpaceX CEO Elon Musk, Tesla has selected Mumbai and Delhi to launch its operations in India.
On Tuesday, the US car maker posted 13 job openings in suburban Mumbai on its official webpage for both customer-facing and backend roles, sending ripples across India’s automotive scenario.
According to Reuters, the company was in talks to open a 5,000 sq ft showroom at Bandra Kurla Complex (BKC) in Mumbai and at Aerocity in Delhi for its flagship store in the National Capital Region (NCR).
A leading luxury car dealer in Mumbai who did not want to be named said, “These large showrooms will amplify brands, sales are secondary. For a brand like Tesla, BKC looks lucrative. But over recent months, luxury car manufacturers have also preferred areas such as Andheri, Goregaon and Powai that have greater purchasing power. Ideally, Tesla should have started with setting up their showroom in south Mumbai.”
Speculation is rife that the company’s India operations could be linked to Tesla setting up its first company-owned, company-operated (COCO) dealership. Chatter in Mumbai’s vehicle dealer associations was that the EV maker was not looking at any franchisee to launch in India.
“What we understand is that Tesla wants to have its own showroom and run it. There is already one leading brand of EVs that has burnt its fingers with technical failures and issues surrounding after sales service. This model may not work in India since conditions here are quite different from the US market. They should ideally tie-up with any leading dealer who can not only sell their vehicles but also provide after sale services which is far more important in Indian markets,” said a senior member of Federation of Automobile Dealers Association (FADA).
This is not the first time Tesla has flirted with the idea of setting up showroom in Mumbai. A land dealer, working closely with the company a couple of years ago when Tesla was looking to setup their showrooms and other infrastructure, said it had, in the past, looked at hiring space in Pune and at Lower Parel in Mumbai. “However, things did not move further. As of now, there is no word from the company to scout for land parcels,” he said speaking on condition of anonymity.
In the past, the EV maker’s entry into India had stalled over the issue of import duties and other taxes. Tesla wanted lower tariffs on imported EVs while the government insisted on local production. For instance, companies are required to set up local manufacturing facilities with a minimum of $500 million in investments. Earlier in this year’s Union Budget, the government reduced basic customs duty (BCD) on high-end cars with a price tag of more than $40,00 from 110% to 70% to incentivise luxury car makers.
If Tesla does come into India it will possibly start with importing its cars and retailing them rather than setting up manufacturing locally, experts said.
