Elon Musk and Tesla Are Ready to Conquer a Big Market

Elon Musk and Tesla do not hide their ambition to dominate the global automotive industry. 

They are aware that their main Chinese rivals continue to gain momentum. This domination involves investing in most markets in order to reach as many consumers as possible. 

Until now, one market had so far resisted Musk and Tesla  (TSLA) - Get Free Report. This is India, which represents a huge opportunity, since the government has said that the country will be carbon-neutral by 2070. Many companies will receive subsidies and state support to produce electric vehicles.

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The Austin, TX-based automaker has been wanting to grab this opportunity for three years, but negotiations with the government never succeeded. The local authorities had made clear that they want the manufacturer to assemble on site the vehicles that it wants to sell to its people. 

The company, however, registered an office in Bengaluru in the southern Indian state of Karnataka in 2021. Local authorities said then that the company was thinking of setting up a factory in the state.

Will Tesla Build a New Factory in India?

After years of stalemate, things have moved at a rapid pace since May. Discussions have indeed resumed between the two parties. Tesla executives traveled to India to discuss the domestic sourcing of parts and incentives with government officials.

Now, it looks like we're getting closer to a big announcement. Musk has just indicated that Tesla will likely make a big investment in India very soon. He made this announcement after a meeting with Prime Minister Narendra Modi, who is on a state visit to the United States.

"I am confident that Tesla will be in India and will do so as soon as humanly possible," the Techno King, as he's known at Tesla, told reporters on June 20 in New York about Tesla's plan to invest in the country.

"I would like to thank the prime minister for his support and hopefully we'll be able to announce something in the not too distant future," Musk continued.

He said that he will visit India in 2024 and did not hide the fact that he is a "fan" of Modi, who wants to make India an alternative to China, at a time when geopolitical tensions between the US and China are at a historical high.

"India has more promise than any large country in the world. He (Modi) really cares about India because he's pushing us to make significant investments in India, which is something we intend to do. We are just trying to figure out the right timing."

India is one of the countries that can allow Musk to realize his ambition to develop a sustainable energy economy, said Musk, who also sees the possibility of establishing a sustainable power generation through solar and wind, and energy storage stationary batteries.

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'Honor'

The billionaire also wants to resume discussions with the Indian government on the launch of Starlink, the satellite internet access service developed by SpaceX. Starlink could be offered to remote regions in the country. SpaceX had opened a unit in India in 2021, but has still not received the green light from the government to launch Starlink.

"Great meeting you today @elonmusk," Modi said on Twitter, with a photo of his one-on-one with the serial entrepreneur. "We had multifaceted conversations on issues ranging from energy to spirituality."

"It was an honor to meet again," Musk responded.

In May, Musk indicated that Tesla would likely announce the location of a new factory by the end of the year. India, he said then, was an interesting place to build a factory. He has also traveled to Europe in recent weeks, and more particularly to France and Italy, where the authorities are courting him to invest in their respective countries.

Tesla currently has four vehicle production sites. There is the factory in Fremont, California and the one in Austin, Texas. The other two factories are based in Shanghai in China and near Berlin, Germany. 

The company is currently building a fifth factory in Mexico.