Tesla to send a team to scout locations to set up its $3 billion factory in India

Electric carmaker Tesla is sending a team to scout locations to set up its proposed $2 billion to $3 billion electric car plant in India, reported Financial Times. As per the report, the focus is on states including Maharashtra, Gujarat and Tamil Nadu, that have automotive hubs.

Tesla factory in India

This comes at a time when Tesla reported a drop in first-quarter deliveries and missing estimates amid low demand and rise in competition in its main markets of the U.S. and China. Tesla's CEO Elon Musk has been pushing to enter the Indian market for years now. However, the Indian government required a commitment to local manufacturing.

Also Read: Tesla to introduce smaller batteries for its car in India: Report

The government last month lowered import taxes on certain electric vehicles produced by carmakers that commit to invest at least $500 million and start domestic manufacturing within three years.

Talks between Tesla and the government have been going on for the last one year. Elon Musk even met with Prime Minister Narendra Modi in June. Following this meet, in July the ev maker said that it was interested in building a factory in India to produce an EV priced at $24,000. Reuters had earlier reported that Tesla also called for lower taxes on more expensive models it wants to sell in India