With Tesla to launch soon in India, what would be price of its cheapest model? Report claims …, highly price-sensitive Indian consumers …

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• With Tesla to launch soon in India, what would be price of its cheapest model? Report claims …, highly price-sensitive Indian consumers …

Speculations are being made over the price.

(Image: www.topgear.com)

New Delhi: Elon Musk, the owner of Tesla, is expected to mark its India launch soon. The Indian market is already abuzz with the excitement in the air in anticipation of the Tesla battery electric vehicles being on sale for the local consumers.

Ahead of the unveiling, speculations are being made over the price tags it could carry for different models. This is after India cut down on the import duty to below 20 per cent. Now the suspense is over the cost of the cheapest version after this much reduction.

According to a report shared by CLSA, a global capital market company, the cheapest car of Tesla will cost around Rs 35 to 40 lakh while Tesla’s cheapest Model 3 in the USA costs around USD 35,000, approximately Rs 30.4 lakh at the factory level. In India, after combining the reduced import duties and additional costs such as road tax and insurance, the on-road price of Tesla’s cheapest vehicle would be around USD 40,000, or approximately Rs 35-40 lakh.

“The cheapest Model 3 for Tesla in the US is c.USD35k. With tariff lowered to c.15- 20 per cent in India, along with road tax, insurance and other costs, on-road price would be c.USD40k, which is close to Rs3.5-4m,” says the CLSA report.

“If Model 3 is pegged at a price 20-50 per cent higher than domestic Electric Vehicle models like Mahindra XEV 9e, Hyundai e-Creta, and Maruti Suzuki e-Vitara, it is unlikely to disrupt the Indian EV market significantly,” says the report.

Even if Tesla decides to launch an entry-level model priced below Rs 25 lakh on-road and gains market share, the report believes that the recent decline in Mahindra & Mahindra’s stock is already factoring in this scenario. However, the report suggests that Tesla’s entry would not have a significant impact on major Indian automakers, as the overall penetration of EVs in India remains lower than in China, Europe, and the USA.

According to reports, Tesla would be launching its models in Delhi and Mumbai in the coming months while Tesla Inc. has officially begun its hiring process in India. The company, on February 18, posted a job listing on LinkedIn for the position of Consumer Engagement Manager in the Mumbai Metropolitan Region.

CLSA report further indicates Tesla’s need to set up a manufacturing facility in India so that it can produce vehicles that would sell at a cheaper price, making them more affordable to the Indian consumers who are highly price sensitive.

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