In today’s Finshots, we tell you why Tesla finally opened shop in India and if it’s too late to win over buyers and beat the EV crowd.

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The Story

Tesla’s finally here. If you pass by Bandra Kurla Complex in Mumbai, you might spot a sleek glass box and a familiar glowing “T” on the wall. Inside, the Model Y sits like an art installation, which you can book online for just ₹22,000.

This model isn’t new, it launched in 2020 and has already become one of the world's best-selling EVs. In most countries, from US to Europe and China, the entry-level RWD variant is priced like a mid-range family SUV between ₹30 to ₹45 lakhs. But in India, that same price balloons to nearly ₹60 lakh, thanks to a brutal ₹21 lakh import duty. That’s because India imposes 60-100% duty on imported cars. The same duty that kept Tesla out of India for years, and has now made it compete with premium brands.

You see, Musk first teased India back in 2017, during Tesla’s imperial phase. The company ruled the EV world, boasted impressive margins, and didn’t need to bend to anyone’s policies. Countries lined up to court Tesla, and India… didn’t. So Tesla walked.

Meanwhile, things changed for Tesla too. Sales in China started flattening, its US growth stalled, and in 2024, it lost the global EV crown to China’s BYD. While Tesla sold about 720,000 vehicles in the first half of 2025, BYD sold over 2 million. It even makes its own batteries. Its lineup ranges from premium sedans like the Seal to hybrid cars and budget hatchbacks like the Dolphin. Cheaper, localised, and increasingly just as advanced.

And in India, BYD was the first mover. Its Atto 3 and eMax 7 are already on roads. And while geopolitical tensions have kept BYD’s expansion in check, the company is building alliances with Indian companies and expanding their manufacturing reach. That tells Tesla it can’t sit out any longer.

So why enter now? After all, the talks for a launch have been doing rounds for a few years.

Well, Tesla’s price tag isn’t a surprise. The company has long grumbled about India’s high import duties, and in 2021 even asked for lower rates. The government pushed back asking Tesla to “Make in India” like Mercedes and BMW already were. And the standoff dragged on for years until, in 2024, India offered a middle path: a policy that allowed any EV manufacturer (not just Tesla) to import up to 8,000 vehicles a year at a concessional 15% duty, provided they commit at least $35,000 million in import value and a base investment of ₹4,150 crore. On paper, it was Tesla’s green light. But so far, there’s been no confirmation of it opting into the scheme and no sign of a factory. Just one showroom, a few sales hires, and a modest service centre tucked away six kilometres from the display floor.

And come to think of it, it’s a strategic move. If things go south, it gets to say: “Look, we tried. But the market wasn’t ready.” And if things go well, that is, if enough buzz builds and policy softens further (especially with the ongoing US-India trade negotiations), it can jump in with a factory and claim it all started here.

And you only need to look at Tesla’s history to know why this could be the reason. In China, it lobbied until it got tax breaks and a fast-tracked Gigafactory. In Germany, it faced backlash for building before environmental clearances and allegedly exploiting a loophole. In the US, it threatened to leave California, and then pocketed billions in tax breaks before moving to Texas.

Besides, Tesla has some good reasons to want India. It’s one of the last major auto markets left unconquered. It’s also a geopolitical hedge against overreliance on China. Plus, Indian cities are clogged with pollution, fuel prices run high, and the government wants 30% of new passenger car sales to be electric by 2030. That’s a dream backdrop for any EV maker.

On the contrary, there sure are challenges as India in 2025 isn't the easiest place to sell premium EVs. In 2024, only about 51,000 luxury cars were sold in India. That’s about 1% of all passenger vehicle sales. Mercedes, BMW, and Audi dominate that tiny slice, and they’ve spent years building trust, service networks, and local assembly lines. Tesla doesn’t have that yet.

Even as India became the world’s third-largest auto market by volume, it remains one of the most complex ones to crack and compete. Global giants like Ford and GM exited after pouring in billions. Because India is, above all, a value-conscious market. Most passenger cars sold in the country cost under ₹15 lakh.

Layer on EVs to that and you see that barely 5% of India's passenger vehicles sold today are electric. Most of that volume comes from domestic brands. And most buyers don’t even have home garages, so charging is still patchy and largely urban.

In that sense, a ₹60 lakh Tesla is a moonshot.

And there’s one more thing: Trust. For years, Indian consumers have seen Tesla flirt with India and disappear. Deposits were taken and refunded, while tweets promised launches that never arrived. In the meantime, Tata turned itself into India’s EV poster child. Mahindra rebooted its SUV brand with sleek EV designs. Even BYD managed to roll cars onto Indian roads despite pushback. Tesla, by contrast, is still in show-and-tell mode.

But perhaps Tesla knows something we don’t. It’s planning to lay the groundwork because this whole thing might not be about short-term sales after all. If it does build a factory in India, it won’t just be for Indians. It’ll be a base to serve other Asian counterparts and compete aggressively with global majors. It’ll tap into India’s rising network of auto suppliers, many of whom already ship parts to Tesla’s US and China factories. And who knows? That ₹60 lakh Model Y could eventually become a ₹40–45 lakh made-in-India electric SUV.

Until then, this is a prestige play while testing Indian waters.

For most of us, comparing a ₹12 lakh Ciaz with a ₹15 lakh electric Nexon, Tesla isn’t part of the equation. It doesn’t change the buying decision. But Tesla does shift something deeper. It forces domestic brands to up their game and raises expectations for design, software, battery life. It adds aspiration, even if out of reach. And that’s how disruption often begins. Not by selling, but by showing.

So will Tesla make it big in India? Only time can tell.

Until then…

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