A group of senior executives from Tesla Inc. are planning to visit India this week to meet with government representatives, reported Bloomberg. According to the report the visit plans come as the automaker is planning to diversify its supply chain beyond China. The report citing people familiar with the matter said that the executives are scheduled to meet with government representatives including those from the office of Prime Minister Narendra Modi to discuss local sourcing of components for Tesla’s models.
This visit could mark a change in the previously strained relations between India and Tesla, the report said adding that the company’s Chief Executive Officer Elon Musk has criticized India’s high import taxes and its electric-vehicle policies.
On the other hand, India has advised Tesla not to sell cars in the country that have been made in China, the report noted,
According to Bloomberg sources, the Tesla executives visiting India this week are expected to include C-suite executives and managers from the company’s supply chain, production, and business development teams. Visits’ main agenda is to request the government to cut import taxes on Tesla vehicles.
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Expanding its supply chain in India would not only allow Tesla to diversify its operations away from China but also align with the Indian government’s initiative of making India a global manufacturing hub. However, Modi’s government has been cautious towards Tesla, requesting it to avoid selling cars assembled in China due to a long-standing border dispute with the country.
“Any brands are welcome in India as long as it is manufactured in India. If any company is making components and vehicles somewhere else and only using India as a market, then that is not welcome,” Union Minister of Road Transport and Highways Nitin Gadkari said last year.
Despite facing challenges in entering the Indian market, Tesla’s competitors such as Mercedes-Benz AG have made progress by selling locally assembled cars, the report noted. Tesla, however, has no plans to set up manufacturing plants in India, citing restrictions on selling and servicing its vehicles. Nevertheless, the company recognizes the need to diversify beyond China in the face of ongoing trade tensions.