Hey everyone! Big news for all you car enthusiasts out there, especially those who've been waiting for Tesla to hit Indian roads

Looks like the wait is finally over. There have been reports all week suggesting Tesla is gearing up for a major shipment to India and is also planning a huge manufacturing push here. This is a massive deal for the Indian car market and signifies a new level of maturity in the EV space.

While we'll be diving deeper into what this means for the Indian electric car market this Sunday, there are some other interesting things happening this week:

• India's Soonicorn Club: A bunch of soonicorn startups (basically future unicorns with a combined valuation of over $40 Bn) have raised more than $15 Bn since 2014. Pretty impressive, right?
• What's next for Bengaluru? The city was the top startup hub for funding in 2023, but the government has its sights set on even bigger things, like creating plug-and-play infrastructure and stronger global linkages.
• Edtech and GenAI: After a crazy year, edtech startups are now turning to artificial intelligence for things like customer support, personalized learning, and creating content.

Now, back to Tesla! ?

This news has put the Indian auto industry in the global spotlight. Tesla is said to have already started making right-hand drive cars in Germany, most likely for the Indian market launch later this year. They're also sending a team to scout locations for a manufacturing plant, with Telangana, Gujarat, and Tamil Nadu being the frontrunners.

Remember all the hype around Tesla coming to India? Well, it seems the Indian government's new EV policy, which allows lower import duties for manufacturers setting up shop here, might have played a role. This policy also mandates companies to use a certain percentage of locally manufactured components, which aligns with similar policies for smartphones and laptops.

Why is India Important for Tesla?

Well, for one, the China+One movement (companies looking to diversify production beyond China) makes India a crucial market, especially considering the slowdown in the US. Second, the Indian EV market is expected to see a significant rise in electric cars by 2030, with the government aiming for 30% EVs on the road.

There's a catch though. While the current electric car market is small, overall EV momentum is positive. Two-wheeler and three-wheeler sales crossed 1.5 Mn in 2023, but electric cars only made up 2% of total car sales.

Tesla's entry comes at a time when demand in its main markets (US and China) is slowing down. They're facing stiff competition in China and some quality issues in the US have dented their reputation.

The Indian Electric Car Race ?

Tesla isn't the only player in the game. Vietnamese manufacturer VinFast is also investing $2 Bn and building a factory in Tamil Nadu. Ride-hailing companies are looking to electrify their fleets, and Ola Electric has plans for an electric car by 2025 or 2026. This competition is only going to accelerate India's EV revolution.

The big question: will Tesla's brand name be enough to sway price-sensitive Indian buyers? They might consider launching a smaller, more affordable car (around $30,000) to compete with existing models.

Taking a Page Out of Apple's Book

Apple's success in India, where they reportedly manufactured iPhones worth ?1 Lakh Cr in 2023, could be a blueprint for Tesla. Just like Apple, Tesla might rely on a network of vendors to set up production in India. Apple has also shown that ‘Made in India’ products can be successful globally, with a significant portion of their Indian-made iPhones being exported.

Tesla would be wise to learn from Apple, but it's important to remember Apple's success didn't happen overnight. They invested heavily and spent years establishing themselves in India. Given the competition, Tesla might want to set realistic initial targets and prioritize building robust charging infrastructure.

Is Tesla Ready for India?

Only time will tell. But there are signs they're preparing for the Indian experience. For instance, their charging stations in the US now have a ‘Magic Dock’ that allows non-Tesla cars to charge. They're also looking at charging solutions for electric two-wheelers, which is a big deal in India.

The entry of Tesla and other global manufacturers could mark the beginning of a golden age for electric cars in India. But a lot depends on how quickly and effectively India develops its EV infrastructure. This could also open up new opportunities