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    4 EV models approved in India, but it’s a long road for Tesla; what we know so far

    4 EV models approved in India, but it’s a long road for Tesla; what we know so far

    4 EV models approved in India, but it’s a long road for Tesla; what we know so far
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    By CNBCTV18.com  IST (Updated)

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    Tesla is reportedly holding early talks with local auto component makers with a view to sourcing equipment when it opens a factory in India. Earlier, the government had asked the company to share details of its manufacturing plans in India before it could consider Musk's tax request.

    US electric carmaker Tesla has got clearance from Indian agencies for four of its models. The four models have cleared the homologation stage. However, the approval does not mean an immediate launch.
    What is homologation?
    Homologation is the process of getting a vehicle certified as being roadworthy and meeting the standards set by the government.
    “The tests ensure that the vehicle matches the requirements of the Indian market in terms of emission and safety and roadworthiness as per the Central Motor Vehicle Rules,” as per the Vahan Sewa website, a portal under the Ministry of Road Transport and Highways.
    According to Vahan Sewa, Tesla India Motors and Energy, the India subsidiary of Tesla Inc, has received approval for four electric vehicles in India. There is no confirmation on the models that have been approved, but the Tesla Fan Club has tweeted that it could be Model 3 and Model Y variants.
    Tesla’s plan for India
    It had recently been reported that Tesla was in talks with three auto component suppliers for critical electrical, electronic and mechanical components like windshields, instrument panels, gears, differential brakes, and power seats.
    Sona Comstar, Sandhar Technologies, and Bharat Forge are understood to be already supplying components to Tesla, according to reports. Tesla is holding early talks with these component makers with a view to sourcing local equipment when it opens a factory in India.
    Lower import duty
    Tesla CEO Elon Musk has been lobbying for lower import taxes on electric vehicles in India. In a tweet in July, Musk said, “import duties are the highest in the world” in India. “Moreover, clean energy vehicles are treated the same as diesel or petrol, which does not seem entirely consistent with the climate goals of India,” he had tweeted.
    His remarks garnered a mixed response from other carmakers. Volkswagen and Hyundai echoed Musk’s claim, while Mahindra sought a review of the import tariffs. Meanwhile, Tata Motors requested the government to be consistent in its approach on local manufacturing of electric vehicles, saying all manufacturers should be treated equally.
    According to Bloomberg, Tesla had written to the transport and industries ministries to bring down import duty on electric cars to 40 percent from the current 60-100 percent.
    At present, the government charges 60 percent for importing electric vehicles priced below $40,000 and 100 percent for cars priced above $40,000.
    Officials told Reuters that the Centre would consider a cut if companies like Tesla firmed up plans to benefit the Indian economy by manufacturing locally.
    Tesla was asked to share details of its manufacturing plans in India and increase local procurement before it considered the EV maker’s import tax demands.
    “Reducing import duties is not a problem as not many EVs are imported in the country. But we need some economic gain out of that. We also have to balance the concerns of the domestic players,” an official said.
    EV market
    Tesla is seeking to gain a foothold in the electric vehicles market in India, which accounts for less than 1 percent of annual car sales. Lack of charging infrastructure, higher costs of vehicles and lack of finance for EV makers are behind poor market adoption of electric vehicles here.
    Apart from the US, Tesla has set up its factory in China. It registered in India as Tesla India Motors and Energy Private Limited in January 2021 in Bengaluru. 
    Responding to a tweet earlier on setting up a factory in India, Musk said, “If Tesla is able to succeed with imported vehicles, then a factory in India is quite likely.”
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