Tesla has decided not to go ahead with a factory in India for a number of reasons
India’s Minister of Heavy Industries, K. N. Balagopal (Kumaraswamy) has just confirmed that Tesla has officially abandoned its plan to build a factory in India.
Analysts noted that this decision was primarily driven by several factors which starts with significant gaps in India’s local supply chain and industrial ecosystem.
It seems a deadlock in negotiations between Tesla and the Indian government over whether tariff reductions should precede factory construction or vice versa is also one of the reasons.
Then there is the issue of inadequate local infrastructure which includes a mismatch between the purchasing power of India’s automotive market and Tesla’s premium product positioning and uncertainties and policy risks associated with India’s business environment.
Meanwhile, on May 19, Tesla shares closed down 2.90%, with a trading volume of $21.258 billion, ranking third among all U.S. stocks by trading value for the day.
