Electric vehicle giant Tesla has finalized an agreement to establish its first showroom in India, marking a significant step in the company's entry into the world's third-largest automobile market, Reuters reported on Wednesday.
According to sources familiar with the matter cited by Reuters, Tesla will initially sell imported electric vehicles while it continues discussions with the Indian government about potential local manufacturing facilities.
The move comes after India reduced import taxes on certain EVs in March, creating a more favorable environment for Tesla's entry into the market. The tax reduction applies to companies committing to invest at least $500 million in India's EV sector, according to the Reuters report.
Tesla CEO Elon Musk met with Indian Prime Minister Narendra Modi in June of last year, signaling Tesla's renewed interest in establishing a presence in India.
The exact location and opening timeline for Tesla's first Indian showroom were not immediately disclosed. Reuters reported that representatives from both Tesla and the Indian government declined to comment on the development.
Industry analysts cited by Reuters suggest this initial retail presence could pave the way for Tesla to evaluate the Indian market's response to its vehicles before committing to larger-scale investments.
In a broader move to signal openness to trade, India recently reduced import tariffs on nearly 30 items, including high-end motorcycles, and announced plans to review surcharges on luxury cars.