India does not expect Tesla Inc to invest in the country soon after Elon Musk’s top brass at the electric car maker stopped contacting the Indian company, people familiar with the matter said.
Musk’s team has not made any further inquiries to officials in New Delhi after the billionaire postponed a visit to India in late April, people familiar with the matter said. They said the government was aware of Tesla’s funding problems and did not plan to provide new investment to India in the near future.
The loss of interest in India comes as Tesla reported its second consecutive decline in global quarterly deliveries and faced stiff competition in China. Musk announced significant layoffs in April, production capacity for the Cybertruck, the electric car maker’s first new model in years, has slowed and construction of a new factory in Mexico has been delayed.
Representatives from India’s Ministry of Heavy Industries, which regulates the auto industry, and the ministries of finance, commerce and industry did not respond to requests for comment. Tesla also did not respond to a request for comment.
Musk canceled a planned trip to India in April that would have included a meeting with Prime Minister Narendra Modi, citing pressing issues at the company.
His initial announcement of his visit comes just weeks after India lowered import taxes on electric vehicles for foreign automakers that pledged to invest at least 41.5 billion rupees ($497 million) and start producing electric vehicles at local factories within three years. .
The Indian government is pinning its hopes on domestic automakers such as Tata Motors Ltd and Mahindra & Mahindra Ltd to boost electric vehicle production, people familiar with the matter said. They added that Tesla would still welcome taking advantage of the new import tax policy if Musk decided to re-engage.
According to Bloomberg New Energy Finance, the Indian electric vehicle market is in its infancy, with electric vehicles accounting for only 1.3% of the total last year. Many buyers are hesitant to switch to electric vehicles due to their high upfront cost and lack of charging stations.
