Piyush Goyal said Tesla plans to nearly double its component sourcing from India
India’s commerce minister Piyush Goyal stated at an auto conference that electric vehicle manufacturer Tesla Inc aims to source components worth $1.7-$1.9 billion from India and has already sourced parts worth $1 billion.
Union Minister Piyush Goyal says in his speech to the 63rd Annual Session of the Automobile Component Manufacturers Association of India, “Tesla already last year bought $ 1 bn of components from all of you sitting here. I am in possession of Tesla’s supplier list. Their goal for this year is close to $ 1.7 or $ 1.9 billion.
According to Reuters, senior Tesla executives met with the minister last month to discuss the possibility of constructing a factory in India that would produce low-cost electric vehicles (EVs) for both the Indian market and export that would cost $24,000, or about 25% less than Tesla’s current entry-level model.
The minister added that nations who deny access to Indian steel companies but are allowed to export the metal to India may face punitive action from the government.
Goyal was making reference to several businesses that import car steel from their home nation.
The car sector still depends on imports for 20% of its needs, and the extent of this dependence varies across companies, indicating that some of them import voluntarily.
The minister also rejected the claim made by some of the multinational automakers that they attract foreign investment to India.
“Investments come to India because of its market size,” he said, adding that this does not mean that “we would have to continue importing goods into India that are available locally at a competitive price and of extremely high quality.”
He also criticised the practise of some businesses, which is to direct their investments from one location and import parts and inputs from nations that are “not very” sympathetic to India.
According to him, India may need to take a closer look at goods imported duty-free under the free trade agreement from other nations to see whether there is a level playing field between Indian suppliers and the nations from where their goods are coming.
The minister said, “Areas of concern are non-tariff barriers erected by some countries, whether legal or unwritten, through which they collaborate not to accept commodities from other countries.
Goyal continued, saying “I am not against imports per se” and said the business should have faith in the domestic environment.
He said that his ministry is introducing standards for quality control for various products.
He also recommended enhancing design and R&D capability.
The minister urged the sector to work on this, saying, “We are also concerned about the skilling, upskilling, and retraining of our workforce.”