Tesla is gearing up to make a grand entrance into India, the world's third-largest car market, starting with the production of right-hand drive cars at its German plant for export to India later this year, according to a recent report.

What Happened: As per a Reuters report, while it’s still under wraps which Tesla model will first grace Indian streets, the buzz is around the Model Y, currently, the only model rolling out from Tesla’s Berlin factory.

Tesla’s move to produce right-hand drive cars in Berlin marks a new chapter for the EV giant, diversifying production locations beyond its Shanghai hub, which has catered to similar markets like Australia and Japan.

Sources in the know have recently whispered about a Tesla team’s upcoming visit to India to scout locations for a manufacturing plant, a move that could see the electric vehicle (EV) giant investing about $2 billion.

See also: India To Overtake UK, Japan As Apple’s 3rd Biggest iPhone Market By 2026

This move comes hot on the heels of India’s decision last month to cut import tax rates on certain EVs, provided their manufacturers commit at least $500 million (₹4,172 crore) to local production within three years. This policy change, which Tesla has been pushing for, aims to make it easier for the company to bring its cars to Indian roads, with some expected to arrive by year’s end.

Tesla’s larger plan: Tesla’s plans for India are not just about selling cars but also about building a comprehensive charging network and increasing local component sourcing, reducing reliance on Chinese imports.

The company is eyeing Tamil Nadu, Maharashtra, and Gujarat for its factory site, aiming to contribute to India’s burgeoning EV market, which, though currently small, is set for exponential growth with a government target of 30% EV sales by 2030.

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