Tesla, led by Elon Musk, has officially started the certification and homologation process for its electric vehicles in India. Since this step is mandatory, the company must complete it before selling its cars in the country.
Tesla Seeks Approval for Model Y and Model 3
Recently, Tesla India Motor & Energy Pvt. Ltd. applied for the homologation of Model Y and Model 3. This process ensures that the vehicles meet India’s safety, emission, and roadworthiness standards under the Central Motor Vehicle Rules. Consequently, this approval is crucial for Tesla’s entry into the Indian market.
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Previous Applications and Trade Talks
Previously, Tesla submitted seven homologation applications, mainly for test cars. Notably, the eighth application was approved recently. Meanwhile, India and the US are engaged in discussions over a free trade agreement. If finalized, this deal could lower tariffs and significantly boost trade between the two nations.
Musk’s India Strategy
As Tesla expands globally, Musk sees India as a key market, especially as he seeks alternatives to China due to US sanctions. However, while the Indian government encourages Tesla to set up a manufacturing plant, Musk currently prefers to export Tesla cars to India without immediate local production.
India’s EV Market Sees Strong Growth
India’s electric vehicle market is growing rapidly. For instance, EV sales rose by 20%, reaching 99,165 units in 2024, up from 82,688 in 2023. At the same time, Tata Motors and JSW MG Motors continue to lead the segment. Additionally, the luxury EV sector witnessed growth, with BMW, Mercedes-Benz India, Volvo, Audi, and Porsche selling 2,809 EVs in 2024, compared to 2,633 in the previous year.
Industry Predictions and Government Support
According to the Federation of Automobile Dealers Associations (FADA), India’s electric passenger vehicle sales increased by nearly 20%. Looking ahead, industry experts predict a compound annual growth rate (CAGR) of 43% for the EV market. Furthermore, government subsidies under the PM E-Drive scheme are playing a vital role in accelerating EV adoption.
Two-Wheeler EVs Also on the Rise
Meanwhile, the electric two-wheeler segment is experiencing remarkable growth. In fact, sales reached 1.13 million units in 2024, a sharp rise from 860,000 in 2023. As a result, overall EV market penetration in India increased to 7.46% in 2024, compared to 6.39% the previous year.
With India’s EV market expanding and Tesla actively seeking certification, the company’s entry into the country seems imminent. However, it remains to be seen whether Tesla will establish a manufacturing plant or continue with its export-first approach.
