Tesla officially launched its first showroom in India on Tuesday, stepping into the world’s third-largest automotive market. Located in Mumbai’s Bandra-Kurla Complex, the showroom will act as Tesla’s flagship retail and experience center for Indian customers.

Years of Delays End with Launch

This debut comes after several years of delays caused by policy hurdles and import tax disagreements. While Tesla’s global sales are declining, especially in China and the U.S., the company hopes its entry into India will revive growth.

Luxury Pricing Poses Challenge

In India, the rear-wheel drive Tesla will sell for around 6 million rupees, or approximately $70,000. This is higher than its U.S. price of about $44,990 (excluding tax credits). Tesla officials said deliveries are expected to begin in the third quarter of this year.

Due to its high pricing, Tesla’s cars will mostly attract India’s luxury car buyers, competing with brands like BMW and Mercedes-Benz. Notably, luxury vehicles make up just 1% of India’s total car sales.

Potential to Boost India’s EV Ecosystem

However, industry experts see Tesla’s arrival as a significant step. Auto analyst Gaurav Vangaal said, “With deeper local investments, Tesla can accelerate India’s EV ecosystem, drive innovation and support the government’s goal of higher EV penetration.”

Prime Minister Narendra Modi’s government has been encouraging Tesla to enter India, seeing it as a symbol of clean energy advancement.

History of Tesla’s India Entry Efforts

Tesla’s journey to India began in April 2016, when CEO Elon Musk invited Indians to preorder the Tesla Model 3. Many placed orders, but after years of delays, bookings were eventually refunded. In 2019, Musk complained on X (formerly Twitter) about India’s high import taxes, which doubled Tesla car prices.

Tesla repeatedly asked Indian authorities to lower import taxes to test the market. However, New Delhi wanted Tesla to build manufacturing facilities before granting tax benefits.

Modi-Musk Meeting Changed Dynamics

After a meeting between Prime Minister Modi and Elon Musk in the U.S. earlier this year, India lowered import taxes from 70%-100% to 15% for EVs under $35,000. The condition was that Tesla must build a factory in India within three years.

Although Musk was expected to visit India in April to announce plans for a factory, he canceled the visit, citing “very heavy Tesla obligations,” and went to China instead. Since then, Tesla has shown little interest in setting up production in India.

Concerns from U.S. Over Tesla’s India Plans

Adding complexity, U.S. President Donald Trump recently remarked that it would be “unfair” if Tesla built a factory in India to bypass U.S. tariffs. Meanwhile, India and the U.S. continue talks over a bilateral trade agreement, focusing on reducing tariffs, including for automobiles.

Musk’s Starlink Plans Also Progressing

Apart from Tesla, Elon Musk is working to launch Starlink’s commercial internet services in India. The project recently received regulatory clearance but now awaits telecom spectrum allocation, expected in the coming months, before full-scale service begins.