Tesla Scouting for a Partner in India to Build Its EVs? Check Details

Despite the Indian government introducing industry-friendly policies for global EV manufacturers, Tesla Inc. is not currently considering setting up its own manufacturing facility in the country. Republic Business has learnt from well-informed sources that the Elon Musk-led company is exploring the option of outsourcing production to another EV manufacturer.

“Tesla is expected to collaborate with an automaker that will handle the assembly and manufacturing of certain models for both domestic and select international markets," revealed a source requesting anonymity.

Another source indicated that Tesla is likely to introduce the Model 3 and Model Y in India during the initial phase, with additional models to follow later. 

Tesla currently sells the Model S, Model X, Model 3, and Model Y in global markets. The company is also developing an affordable compact car, potentially named the Model 2, which is expected to be priced at around €35,000 (₹21–25 lakh).

"Tesla's strategy will be similar to Apple Inc.’s approach in India's smartphone sector. Once the EV maker achieves significant sales volumes—especially after the launch of the Model 2—it will outsource assembly operations to a contract manufacturer or an Indian OEM," another source added.

An emailed query sent to Tesla’s global spokesperson remained unanswered at the time of publishing. This story will be updated once the company responds.

"Tesla will take a slow and steady approach. The company will start with Completely Built Units (CBUs), set up a few showrooms to generate hype, and only consider manufacturing if import duties are reduced. Even then, instead of investing heavily in a market that might not be very large for EVs, Tesla is more likely to opt for contract manufacturing," stated Avik Chattopadhyay, Co-Founder of Expereal.

Republic Business previously reported that Tesla is actively engaging with Indian suppliers for critical components, including interior and exterior parts, automotive electronics, and more, for its upcoming compact e-car.

Meanwhile, Tesla recently posted job advertisements for 13 mid-level roles in India on LinkedIn, further hinting at its potential entry into the country. Some media reports also suggest that the company has finalized locations for showrooms in New Delhi and Mumbai.