Tesla gets support from Hyundai in its call for seeking lower import duties in India

Hyundai backs Tesla’s plea for lowering import duties.

● Tesla asks the Indian Government to reduce import duties on electric vehicles.● Hyundai follows suit by supporting Tesla’s call.● Import duty reliefs can help generate sales volume and viability.

With petroleum prices touching new heights every day, people are looking for suitable alternatives. Electric vehicles offer an excellent substitute to petrol and diesel vehicles, but the import duties and taxes on imported vehicles, especially fully assembled EVs, are massive.

Tesla, the primary manufacturer of EVs globally, is keen to set up a factory for manufacturing and importing EVs. However, the government import duties on fully assembled EVs are proving a significant deterrent. Tesla has asked the Indian Government to consider reducing taxes and import duties. Hyundai Motor India has now backed Tesla's call stating that the move to reduce import duties would be welcome and help companies achieve the necessary sales volume and enhance viability.

Hyundai Motor India has opened its new corporate headquarters at Gurugram recently, aiming to popularize EVs in India. The company feels that the Indian Government should support by reducing taxes and make it conducive for investing in charging infrastructure to help speed up EV adoption in India.

Hyundai Motor India MD and CEO Mr. S. S. Kim reiterated Tesla's demand for reducing import duties, stating that reducing these duties and taxes can help create market space and reach a viable scale.

Tesla had written to the Indian ministries seeking a reduction on import duties of fully assembled EVs that are the highest in the world. The currently prevailing import duties of EVs priced below $40,000 is 60% and 100% for cars above $40,000. The duties depend on various factors like engine size, freight, and insurance.

Elon Musk had tweeted that Tesla is interested in venturing into India with their latest EVs but seeks Government support. The tweet adds that India treats EVs on the same platform as petrol and diesel, which is inconsistent with India's climate goals.

Kim states that EVs could take time to gain traction, despite the massive potential for electric two-wheelers and three-wheelers in India. He feels that charging infrastructure is the most significant challenge for manufacturers and the biggest concern for consumers.

Kim reiterates that the Government should also consider making it more conducive for investors to invest in charging infrastructure as it is critical for India's growth. Customer incentives and industry support can help the EV market reach a significant level of scale in about two years. However, until we reach the critical point, we need support from the Government.

Hyundai – Plans for India

Hyundai is planning to launch the all-new micro SUV, AX1, in India soon after its international debut scheduled for the final quarter of 2021. This vehicle is due for a launch in South Korea under the name Casper. However, Hyundai is still some time away from mass-market EV production in India.

The Alcazar 3-row SUV was Hyundai's latest launch in the Indian domestic market. This car has generated tremendous interest, with the company receiving more than 11,000 bookings in its first month. Hyundai has already delivered more than 5,600 units to its customers.