Tesla Introduces Model Y in India at a Price Tag of $73,200 USD, While It's Sold for $37,490 in the U.S.; consumers in India to Fork Over $34,940 in Taxes During Purchase
Tesla's Model Y Remains Out of Reach for Many Indian Drivers
In a world where electric vehicles (EVs) are becoming increasingly popular, India finds itself struggling to keep up. The primary global competitor to Tesla, BYD, has found a way around India's steep import tariffs by assembling some of their models locally through a semi-knocked down (SKD) or completely knocked down (CKD) process. However, Tesla, which imports and sells the Model Y in India, is yet to follow suit.
The high price of the Model Y in India is largely due to import duties. A completely built Model Y can amount to approximately $29,000 more during purchase compared to its price in Germany or China. In Germany, the Model Y costs about $55,000, and in China, it costs approximately $37,500. In contrast, the same Model Y sells for $37,490 in the United States after tax credits.
The high taxes have not gone unnoticed by Indian consumers. Some users on social media have expressed frustration about the high taxes and the lack of value received in return, citing crumbling roads, failing infrastructure, and frequent waterlogging as examples.
Experts suggest that investing in education, supporting youth, and thinking bigger could lead to building EVs at lower prices than Tesla, potentially making India a leader in the industry. Kunal, one such expert, emphasized the importance of local manufacturing, stating that once there is demand, manufacturers can obtain necessary approvals from the Indian government to build locally, and prices will decrease.
However, India's 100% import tariff on completely built vehicles is increasingly seen as a barrier to progress and innovation in the EV industry. Developing nations like India often use high tariffs to protect domestic manufacturers and support job creation, but these policies can drive the price of world-class products like Tesla's Model Y out of reach for most consumers.
Unless there is a serious shift in policy or manufacturing, Tesla might remain unaffordable for many Indian drivers, symbolizing what's possible but not what's practical for millions of Indian drivers. The Shanghai Gigafactory, a local manufacturing facility built by Tesla in China, is a testament to the potential benefits of local production.
In countries like China and Brazil, tariffs on imported cars were initially high but gradually shifted towards encouraging local production partnerships and foreign investment. This move has contributed to faster development in these countries compared to India. It remains to be seen if India will follow a similar path, making the Tesla Model Y, and other world-class EVs, more accessible to its citizens.
