Tesla CFO Vaibhav Taneja said on Tuesday that Tesla was cautiously navigating entry into India, targeting the country’s ‘big middle class’ despite India being subject to a 70% tariff on EV imports and about 30% luxury tax. He noted that these levies could make India-sold Teslas twice as expensive.
Taneja confirmed reports that Tesla was working on an expansion into India, adding that it would be a great market to enter due to its ‘big middle class’. He, however, acknowledged that it was still a ‘very hard market’ since India was subject to a 70% tariff on EV imports and a nearly 30% luxury tax. Tesla CEO Elon Musk said on Tuesday that he did not like high or unpredictable tariffs, but any decision on what happens with them was ‘entirely up to the president of the United States’.
India’s Prime Minister Narendra Modi held a conversation with Musk on Friday, April 18th, where they discussed opportunities for collaboration in technology and innovation. The interaction built on their previous meeting in Washington, DC, earlier this year. Tesla is reportedly recruiting and scouting showroom locations in India following the meeting between Modi and Musk.
Taneja addresses tariff concerns as Tesla considers entry into India
$TSLA CFO Taneja says India 🇮🇳 is a “very hard market” to enter given the current tariff structure. Any Tesla shipped there faces a 70% import duty plus a 30% luxury tax, making cars nearly twice as expensive. Tesla’s being cautious on timing, but still views India as a key…
— Wall St Engine (@wallstengine) April 22, 2025
Senior executive Taneja noted that while Tesla had not confirmed whether it would happen this year, the company aimed to tap into India’s large middle-class market, a segment the electric car maker is actively targeting. He pointed out that The EV maker was working on getting into India’s very hard market, especially with the current tariff structure.
Taneja explained that any car Tesla sent to India was subject to a 70% tariff and also a 30% luxury tax, meaning the same car was 100% more expensive in India than it was in the local U.S. market.
Travis Axelrod, head of investor relations at Tesla, also said the company was working on entering ‘hot-market’ India, but the prospect of a 100% tariff on car imports created a lot of anxiety.
“That’s why we’ve been very careful trying to figure out when the right time is… these kinds of things create a little bit of tension, which we are trying to work out.”
-Vaibhav Taneja
The EV maker has identified at least two locations where it will open its first stores in India and listed 30 jobs for the same, including three in the supply chain.
Musk says he does not like high or unpredictable tariffs
Musk said on April 22nd that he did not like high or unpredictable tariffs but added that any decision on what happened with them was entirely up to the U.S. president.
As he spoke on his company’s first-quarter earnings call, Musk mentioned that Tesla was in a relatively good position compared to other U.S. automakers–despite the swirling tariff-related uncertainty across the economy–because it had ‘localized supply chains’ in North America, Europe, and China. The billionaire investor also said Tesla was the least-affected car company with respect to tariffs, at least in most respects.
Musk said Tesla was the most ‘vertically integrated car company’ but noted that plenty of taxable parts and materials came from other countries. The Tesla boss added that even though the electric automaker had built a lithium refinery in Texas, the U.S. was still not growing rubber trees and mining iron yet. Musk also mentioned that Tesla was working on securing additional supply chains from non-China-based suppliers but acknowledged that this would take time.
The EV maker reported poor quarterly earnings and sales on Tuesday, including a 20% YoY drop in revenue and a 71% plunge in net income. The company also disclosed that it was not providing any guidance for 2025, at least until its second-quarter update.
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