Tesla on Tuesday unveiled its first showroom in India, marking its entry into the world's most populous country after years of lobbying for a potential factory, as Elon Musk's electric vehicle company seeks new customers amid falling sales in the U.S. and Europe.
The store opened its doors in India's financial capital Mumbai – to select visitors – after its inauguration by Maharashtra state's chief minister Devendra Fadnavis.
Tesla opened its first showroom in Mumbai and began taking Model Y orders on its website, marking its long-awaited entry into the market where Musk once had plans to open a factory.
For now, Tesla will import cars into a country where tariffs and related duties can exceed 100%, driving up the price for consumers.
The company launched its Model Y at about $70,000 in India, the highest price among major markets, as the U.S. automaker, grappling with slowing sales bets on prospects in the country Musk has long criticized for its high import tariffs.
With deliveries estimated to start from the third quarter, Tesla is targeting a niche electric vehicle segment in India that accounts for just 4% of overall sales in the world's third-largest car market.
It will compete mainly with German luxury giants such as BMW and Mercedes-Benz rather than domestic mass-market EV players such as Tata Motors and Mahindra.
"This is the first launch of Tesla in India. It marks a huge milestone for Tesla globally," said Isabel Fan, the company's senior regional director, adding that charging stations would be set up in Mumbai and the capital, New Delhi, shortly.
While the showroom will open to the general public on Wednesday, curious onlookers and Tesla admirers braved Mumbai's heavy rains to catch a glimpse of the cars on display.
Tesla has for years signaled its interest in India but held back due to the country's steep tariffs on EVs.
Musk, who once described India as having "more promise than any large country," has also criticized its import duties, calling them among the "highest in the world."
New Delhi has offered to cut import taxes on electric vehicles for global automakers only if they commit to investing hundreds of millions of dollars and make cars locally.
Tesla has yet to announce plans to set up a plant in India.
Grappling with excess capacity in global factories and declining sales, Tesla has adopted a strategy of selling imported vehicles in India, despite the duties and levies.
The U.S. EV maker has long lobbied India for lower import tariffs on cars, and Prime Minister Narendra Modi's officials remain in talks with U.S. President Donald Trump's administration to lower the levies under a bilateral trade deal.
But the cars Tesla displayed in Mumbai were made in China, and its U.S. factories do not currently make the right-hand drive vehicles that are used in India.
Tesla's Model Y rear-wheel drive is priced at about 6 million rupees ($70,000), while its Model Y long-range rear-wheel drive costs 6.8 million rupees.
That compares with a starting price from $44,990 in the U.S., 263,500 yuan ($36,700) in China, and 45,970 euros ($53,700) in Germany.
The firm's Full Self-Driving (FSD) capability is on offer at an additional cost of 600,000 rupees, with future updates promised to enable operation with minimal driver intervention.
Soumen Mandal, a senior analyst at Counterpoint, said the high price tag will likely place it out of the price range of most Indian customers and see it compete against offerings from luxury carmakers instead.
"We don't expect Tesla to play the volume game right away given the price tag," Mandal told Agence France-Presse (AFP).
"We project 500-700 units sold in initial months and then that to taper off to 200-300 (per month)."
On Tuesday, police guarded Tesla's Mumbai showroom as media crowded outside the office complex where it is located and the chief minister of the western state of Maharashtra, home to the Indian commercial capital, arrived for the launch.
