Tesla’s stock (TSLA) tumbled by as much as 10% this morning amid a broader market setback. Tesla seems to be particularly affected after India shut down the idea of Tesla importing cars from Giga Shanghai and questions about Elon Musk buying Twitter.
India has the biggest auto market that Tesla has yet to enter.
For years, Elon Musk said that Tesla’s launch in India was imminent, but strong import tariffs have made it difficult. Nonetheless, the automaker has had some indications of preparing for a launch over the last year.
In 2021, Tesla officially incorporated an Indian company in Bengaluru, the capital of India’s southern Karnataka state. During the summer, Indian government officials said that they are considering Tesla’s proposal to greatly reduce import duties for electric cars, which has been the main hurdle for the company to enter the market.
The government has maintained high import duties on EVs to encourage local production, but so far, it has mainly resulted in preventing automakers to import popular EVs produced outside the country, including in China.
Tesla has expressed interest in building a factory in the country, but as it has done in every other market, the automaker prefers to first test the waters with imported vehicles.
More recently, Tesla vehicles have been spotted being tested on Indian roads and it got seven electric vehicle variants approved in the country, but four months later, it has yet to launch in the country.
Now, the Indian government appears to shut down Tesla’s plan as transport minister Nitin Gadkari announced that Tesla is still welcome to build a factory in India, but it doesn’t want Tesla to import vehicles from China:
Making in China and selling here is not a good proposition.
With Gigafactory Shanghai being Tesla’s main export hub, the first Tesla vehicles in India would have likely been coming from China.
Tesla’s stock (TSLA) was down by more than 9% this morning – trading at around $900 a share. The stock is also affected by a broader market setback with the NASDAQ being down 3%.
Tesla investors have also questions about Musk buying Twitter, which was confirmed yesterday, and how much time that will take the CEO away from Tesla, and if he is going to have to sell Tesla shares to cover some of the $21 billion in equity he needs to come up with for the acquisition.
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