#Tesla in India, a Strategic Reality Check!
#Tesla has registered itself in India and has set up its office in Bengaluru. That's all everyone can talk about these days. In the frenzy, there are those who are fantasizing about Tesla overrunning the Indian car market and are signaling the end of the incumbent car manufacturers. Make no mistake, it is indeed a very welcome step in the right direction, but there are some very difficult and very real challenges to overcome, probably requiring unique solutions specific to the Indian market that Tesla would need to overcome if it wants to establish its footprint here.
The Skeleton
There is no doubt about it. The success Tesla has seen in the US would not have been possible if not for its extensive Super-Charger network. That indeed forms the backbone on which the other parts of the business developed, and with much effort, Tesla seems to have got itself a workable scenario there.
But with India, it is entering into a completely different ball game. The culture, the consumer behavior, the political scene, the physical conditions, heck... even the weather, all would need to be delicately balanced to build up this spine in India. Nothing should be taken for granted and copied over from its US business model. I implore Tesla to not repeat the mistakes of so many other brands that had previously attempted to expand to India and establish a base here, and ultimately had to close shop and leave with immense sunk costs! Sure you can leverage your learnings to an extent in certain microcosms of the problem, but the overall approach would need to be built from the ground-up on a clean drawing board. The criticality of getting things right in this step simply cannot be overstated!
The Muscle
Notwithstanding the hype and genuine interest, when it comes to putting their money to where their words are, Indian consumers are incredibly price-sensitive. Sure there would always be those who would be early adopters, irrespective of the price tag. But it would be impossible to achieve the economies of scale it needs to achieve to make the venture worth the effort and the investment. India has a very vigorous young-consumer market segment, where the sense of ecological responsibility is higher, price sensitivity is relatively lower, and international exposure is at its peak. That I believe would be the sweet-spot Tesla should target in its positioning. Now, if the existing models can be tweaked to meet that positioning requirement, or if it would need a fresh model, would be a decision to be taken based on its supply chain, and research expenses. But it is a question worth deliberating upon now, rather than later.
The Cover
It is a well-established fact that after-sales support is a huge part of the automotive lifecycle. This is where Tesla would find itself to be at the most disadvantageous position when compared to the entrenched competitors with deep roots and wide coverage. The traditional wisdom in this space would call for a parallel-play strategy to nurture and develop reliable partners even before the first set of wheels hit the ground. The network needs to be ready-enough to instill confidence in consumer minds and allay any apprehensions they may have, (and considering the societal aspects, including those that their near and dear from Gen X would challenge them on). But then it is equally important to keep your mind open to outside-the-box solutions. The target state to attain would be to make this aspect of the customer lifecycle, a complete non-discussion no-brainer. How it is achieved is immaterial.
Conclusion...
With all that said, I want to once again affirm my heartiest support for this long-awaited venture, calling for a cultural, societal, and environmental revolution that this would likely be a big part of. In fact, it is my sincere hope that they do succeed, and it is only that hope that drove me to pen down my thoughts today. The road ahead is bumpy and full of potholes (pun intended), but with the right strategy and approach, I am sure it is absolutely doable.
#IndiaIsReady #AreYou?