(Commonwealth_India) Tesla has finally arrived in India, making a cautious but exciting entry into one of the world’s fastest-growing economies. On Tuesday, the electric vehicle giant opened its first showroom—called the “Tesla Experience Center”—in a sleek, upscale mall in Mumbai, a vibrant metropolis of nearly 13 million people, or over 23 million if you count the surrounding region.
Right now, Tesla is keeping things simple. The only model available in India is the refreshed Model Y, which will be imported from Tesla’s Shanghai factory. Since it’s being shipped in, the price is steep, starting at ₹61 lakhs (around $70,000). That’s quite a leap from the U.S. price of $44,900 for the same car. The reason? India’s famously high import duties, which can almost double the price of foreign-made cars.
Deliveries are expected to begin in the third quarter of this year. But let’s be honest—most people in India won’t be rushing to buy a $70,000 electric SUV. The average annual income in the country is about $4,000, and EVs still make up just 4% of all vehicle sales here. Tesla knows this isn’t going to be a volume game—at least not yet.
Industry experts aren’t surprised. We do not imagine Tesla to play the volume game right away, given the price tag, said Soumen Mandal, senior expert at Counterpoint Research.
But this isn’t just about today. Tesla’s move into India is about the future, and the potential here is enormous. According to the OECD, India’s population is on track to hit nearly 1.7 billion by 2050, surpassing China, whose population is shrinking. And while a large part of India’s population is still rural and underemployed, things are changing. A growing urban middle class is emerging, and that could reshape the consumer landscape in the coming decade.
One study by People Research on India’s Consumer Economy (PRICE) suggests that by 2030, India will add about 75 million middle-class households and 25 million wealthy ones. That would mean over half the country’s population could afford products like smartphones, high-end appliances, and yes, maybe even a Tesla.
But breaking into India isn’t just about bringing cars in. For decades, the country has maintained high import tariffs to protect local manufacturing and push foreign companies to invest in domestic production. That’s part of why Tesla’s Model Y costs so much here. These protectionist policies go back over 70 years and have proven tough to negotiate around. But there’s hope: India’s trade officials are in Washington right now trying to work out some middle ground with their U.S. counterparts.
Tesla CEO Elon Musk has hinted before that he might build a factory in India, which could help bring down prices and make Tesla more competitive here. But lately, Musk has been more focused on AI and self-driving tech, so a major investment in Indian manufacturing might not be at the top of his list—at least not right away.
Still, there’s another option: Tesla could invest in research and development centers in India, which might help ease some of the tariff barriers without the cost of building an entire factory. Maharashtra’s chief minister, Devendra Fadnavis, is hopeful. “In the future, we wish to see R&D and manufacturing done in India, and I am sure at an appropriate stage, Tesla will think about it,” he said.
Musk himself is a bit of a mixed figure in India. He’s admired by many as a visionary entrepreneur, but his social media platform, X (formerly Twitter), is caught up in a legal fight with the Indian government over content regulation. That complicates his image here.
Still, Musk and Indian Prime Minister Narendra Modi seem to have a positive relationship. The two met one-on-one earlier this year during Modi’s visit to Washington, and both appear keen to strengthen business ties. Modi, for his part, has made it clear that he wants to open up India to more foreign investment and reform outdated policies.
Interestingly, even Indian automakers seem to be embracing the new competition. Anand Mahindra, chairman of the Mahindra Group, greeted Tesla’s arrival with X: Welcome to India, Elon Musk and Tesla. One of the world’s main EV openings just got more stimulating. Competition drives invention, and there’s ample road ahead. Looking forward to seeing you at the charging station.
In the end, Tesla’s launch in India may be small for now, but it’s a meaningful first step. The company is planting roots in a market that, while complicated and challenging, could be a major growth engine in the future. For now, Tesla is testing the waters. But if the tide turns in its favor, India could play a big role in the company’s global expansion story.
