Why Indian automakers aren’t worried about Elon Musk’s Tesla

Tesla, the world’s leading electric vehicle (EV) manufacturer, has set its sights on India, with plans to open a showroom in Mumbai's Bandra Kurla Complex (BKC) and eventually establish a manufacturing plant in Maharashtra. Despite the brand's global success and its disruptive potential, Indian automakers aren't particularly worried about Musk's expansion into the Indian market. In fact, they are confident that local giants like Tata Motors and Mahindra & Mahindra will continue to dominate the space.

JSW Group Chairman Sajjan Jindal, who has a joint venture with China's SAIC Motor for MG Motor India, believes Tesla faces an uphill battle in India. He argues that local manufacturers have already established a strong foothold. “Elon Musk is not here. He is in the US. We Indians are here,” Jindal said. He expressed confidence in the success of Indian auto brands, emphasizing their ability to offer vehicles suited to the local market at competitive prices.

Indian automakers are particularly bullish about competing with global players, including Tesla. Rajesh Jejurikar, Executive Director and CEO at Mahindra & Mahindra, pointed out that Indian companies are not intimidated by foreign competition. “We are capable of making world-class vehicles. If Tesla wants to enter India, they’ll need to compete on price,” Jejurikar said, referring to Mahindra’s affordable electric vehicles, which start at approximately ₹20 lakh.

Anand Mahindra, Chairman of Mahindra Group, also expressed confidence in the Indian automotive industry, suggesting that local manufacturers have proven their resilience in the face of competition. He added that Mahindra will continue to innovate and remain relevant in the long run, regardless of the competition.

While Tesla’s entry is significant, its high pricing model could be a roadblock. Reports indicate that Tesla’s cars, even with potential reductions in import duties, would remain inaccessible to most Indian consumers. Local automakers, including Maruti Suzuki, Tata Motors, and Hyundai, have an edge in terms of cost, local manufacturing, and supply chain advantages, which make their EVs more affordable to Indian buyers.

Even the much-anticipated $25,000 Tesla model is expected to face stiff competition from well-established Indian brands offering feature-rich, value-for-money vehicles. Despite the hype, analysts predict that Tesla’s impact on the Indian market will be minimal unless it significantly localizes production and adjusts its pricing strategy.

For now, Indian automakers remain unfazed by Tesla's plans and are confident that their market leadership will continue to hold strong.