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regular-article-logo Friday, 14 June 2024

Mukesh Ambani and Elon Musk weigh EV alliance

Musk, the Tesla CEO, is due to meet Prime Minister Narendra Modi this month and announce the EV plant

Our Special Correspondent Mumbai Published 11.04.24, 07:47 AM
Elon Musk

Elon Musk File Photo

Business titans Mukesh Ambani and Elon Musk may come together to make electric vehicles in the country.

Musk’s Tesla is reportedly in talks with Ambani’s Reliance Industries to set up a manufacturing plant through a joint venture, says Hindu Business Line. The plan is to make or assemble electric cars in India.

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Musk, the Tesla CEO, is due to meet Prime Minister Narendra Modi this month and announce the EV plant.

The possibility of a Tesla entry had generated quite a buzz in India Inc, with the automaker eyeing multiple locations such as Gujarat, Maharashtra, Telangana
and Tamil Nadu.

That Tesla is serious about India was clear from Musk’s comment at an X (formerly Twitter) event with Nicolai Tangen, CEO, Norges Bank Investment Management.

“India is now the most populous country in the world, based on population. India should have electric cars just like every other country has electric cars. It’s a natural progression to provide Tesla electric vehicles in India.’’

It is understood that Tesla could invest up to $2 billion in the upcoming plant in India.

A report in the Hindu Business Line on Wednesday said talks between Tesla and Reliance are at an early stage and have been ongoing for over a month.

The potential tie-up with RIL should not be construed as Mukesh Ambani’s entry into the automobile space, the report said.

RIL’s aim in the joint venture is to provide the infrastructure to make electric vehicles. Its key role will be in setting up the allied ecosystem for Tesla.

Mega plans

Reliance has announced a Rs 1.5 trillion investment in green energy that includes a five giga factories in five critical areas: photovoltaic panels, fuel cell system, green hydrogen, energy storage and power electronics.

In October 2023, it had unveiled removable and swappable batteries for EVs and said it was working on intelligent swap stations and integrated charging networks.

Reliance had also said it would not venture into EV manufacturing but look to partner other car makers. Though the likely tie-up between Tesla and Reliance could not be independently confirmed, a Reuters report said Musk will visit India this month and is expected to make an announcement on his plans to open a new factory in the country.

The report added that Musk will meet Modi in the week of April 22 in Delhi and will separately make an announcement about his India plans.

EV policy

Musk and Modi last met in New York in June, and Tesla for months lobbied India to lower import taxes on electric vehicles while it weighed up a factory there.

The Indian government last month offered import duty concessions to companies setting up manufacturing units in the country with a minimum investment of $500 million. It was believed to be targeting players such as Tesla.

The Centre has further said that firms setting up manufacturing units will be allowed to import a limited number of models with a duty rate of 15 per cent on vehicles costing $35,000 and above for five years.

Tesla has also begun production of right-hand drive cars at its German plant for export to India later this year, according to Reuters.

Tesla’s push into India comes as slowing EV demand in its main US and Chinese markets coincides with intensifying competition from Chinese automakers.

Tesla reported a drop in first-quarter deliveries that missed analyst estimates.
With inputs from Reuters

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