Team siliconindia

• Tesla opened its first showroom in Mumbai, showcasing the Model Y priced at Rs 61 lakh.
• Nearly half the price is due to steep import taxes, as the vehicle is shipped fully built from Shanghai.
• With no factory or charging network in place, Tesla’s India strategy hinges on future localisation efforts.

A soft breeze swept across Mumbai’s Bandra-Kurla Complex evening as Tesla inaugurated its first showroom in India, marking a long-anticipated entry into one of the world’s fastest-growing automobile markets. Beneath bright LED lights and amidst palpable excitement, the star of the launch Tesla’s Model Y stood gleaming, offering Indian customers a glimpse into the future of electric mobility. But owning one will come at a steep price: the rear-wheel-drive version carries a price tag of Rs 61 lakh, nearly double its cost in the United States.

This jaw-dropping price point isn’t just about luxury positioning it’s largely the result of import duties. India levies between 70% and 100% in customs duties on fully built imported vehicles. In Tesla’s case, nearly Rs 29 lakh of the Model Y’s sticker price is swallowed by taxes alone, well before an owner even turns the key. For years, Tesla CEO Elon Musk has lobbied via tweets and behind-the-scenes discussions for a reduction in tariffs. However, India has remained firm: if Tesla wants tax concessions, it must manufacture locally.

For now, Tesla’s physical presence in India is limited to the polished floors of its Mumbai showroom. The displayed vehicle is manufactured in Shanghai one of the few Tesla factories producing right-hand-drive models with customer deliveries expected by the third quarter of 2025. A second showroom is in the works for Delhi later this year.

“It’s an audacious pricing strategy”, said Meera Chavan, a Pune-based auto analyst present at the launch. “Tesla is entering India not as a mass-market disruptor but as a luxury aspirant. The challenge is whether early adopters alone can sustain that positioning”.

India’s electric vehicle (EV) market remains nascent, accounting for just under 4% of total car sales. Local players like Tata Motors and Mahindra have gained momentum with EVs priced at half the cost of the Model Y, supported by expanding domestic charging networks. In contrast, Tesla enters the Indian market with no supercharger infrastructure and no access to the recently lapsed government EV subsidy program.

The global EV market hasn’t been particularly encouraging either. As subsidies fade and consumer spending tightens, EV demand has softened from Berlin to Beijing. Even Tesla saw an 8% drop in global deliveries last quarter the company’s first year-on-year decline since the pandemic.

Still, Tesla’s brand appeal remains unmatched. Enthusiasts at the Mumbai showroom lingered long after the event, admiring the vehicle’s panoramic roof, minimalist interior, and advanced tech features like Autopilot. “It’s expensive, yes, but there’s nothing quite like a Tesla on Indian roads”, said a fintech entrepreneur, shrugging off the premium. 'You pay for the leap'.

Also Read: Tesla India Debut Sends Shockwaves Through Auto Sector

Whether Tesla can sustain its momentum in India will depend on its speed in localising operations. Industry insiders suggest the company has explored sites in Maharashtra and Tamil Nadu, but no concrete plans have materialised yet. Until a local plant is built, every imported Model Y will continue to attract hefty taxes a stark contrast to its price tags of Rs 32 lakh in the U.S., Rs 37 lakh in China, and Rs 54 lakh in Germany.

As the showroom shutters rolled down at dusk, a Nexon EV taxi idled at the curb. Its fare card read, 'Silent. Affordable. Indian'. A fitting juxtaposition in a market where prestige and practicality often go hand in hand and where Tesla’s true test may lie not in admiration, but in affordability.