The long-awaited moment has arrived: Tesla has officially made its debut in India, the world’s third-largest auto market. The all-electric car manufacturer is keen on establishing a presence in this rapidly growing economy, which could help mitigate the company’s recent global sales challenges.
On Tesla’s new India webpage, customers can now place orders for the Model Y SUV. However, the offerings are limited to two variants: the Rear-Wheel Drive (RWD) starting at ₹59,89,000 (approximately €66,066) and the Long-Range Rear-Wheel Drive (LR RWD) priced at ₹67,89,000 (around €74,490).
To put this in perspective, the Long-Range Model Y costs only $44,990 (€41,000) in the United States. When factoring in the $7,500 (€6,900) federal EV tax credit available to eligible buyers, the effective price drops to $37,490 (€34,300), making it significantly cheaper than the prices seen in India.
This hefty price tag positions the Model Y out of reach for most Indian consumers. With an approximate average annual salary of ₹3,58,000 (around €3,950) expected in 2025, the base Model Y costs more than 17 times what an average Indian earns in a year. This reality raises important questions: Why is Tesla entering such a price-sensitive market with offerings that most cannot afford?
Tesla remains hopeful that a reduction in India’s steep automotive import tax—ranging from 70% to 100%—to approximately 10% could change the current landscape. This would enable Tesla to lower the Model Y’s cost for consumers and potentially import cars from their Giga Berlin facility rather than Giga Shanghai, as noted by Sawyer Merritt, a Tesla investor, on X (formerly Twitter).
NEWS: Tesla has officially launched orders of the Model Y in India! The first ever Tesla car deliveries in the country will start this quarter (Q3 2025).
Starting prices:
• Model Y RWD: $69,700 (USD)
• Model Y LR RWD: $79,000 (USD)FSD also costs $7,000 USD in India. Model Y… pic.twitter.com/t6c5UrfXwn
— Sawyer Merritt (@SawyerMerritt) July 15, 2025
The first deliveries are set to commence in the current third quarter. Tesla CEO Elon Musk has long viewed India, with its vast population of 1.46 billion, as a vital market. He previously described India as more promising than any other country but highlighted the impracticality posed by high tariffs.
Recent developments indicate that India is beginning to sweeten the deal for foreign automakers by offering tax breaks on imported electric vehicles, provided they establish local manufacturing. However, according to reports, Tesla has yet to announce concrete plans for building a factory in India, meaning the Model Ys will be imported from their Shanghai Gigafactory.
Meanwhile, Tesla’s global sales have been declining. In the second quarter of 2025, the company saw a 13.5% decrease in global deliveries, part of a broader slowdown in the electric vehicle sector as consumer demand wanes in the U.S. India’s electric vehicle market, while rapidly expanding, is still small; just over 100,000 EVs were sold in 2024, representing less than 3% of total car sales.
Tesla’s entry into India unfolds amid broader trade discussions between India and the United States. With former President Donald Trump threatening steep tariffs on countries like India, New Delhi officials are striving for a bilateral trade agreement. Moreover, the Indian government recently approved Musk’s Starlink satellite internet service to operate in the country, suggesting a warming of economic relations with Tesla.
Could Tesla’s Model Y spark a revolution in India’s electric vehicle market? As the company navigates these challenges, will it be able to realize its ambitions in one of the world’s fastest-growing economies?
What are the pricing details for the Tesla Model Y in India? Tesla is offering the Model Y SUV in two variants, with prices starting at ₹59,89,000 for the Rear-Wheel Drive and ₹67,89,000 for the Long-Range variant.
Why is Tesla charging more for the Model Y in India compared to the U.S.? The high import taxes in India, which can reach up to 100%, significantly increase the cost of the Model Y in the Indian market, leading to a price that’s much higher than in the United States.
Is Tesla planning to manufacture cars in India? Currently, there are no confirmed plans for Tesla to build a factory in India; the Model Ys available will be imported from Shanghai.
How has Tesla’s global performance been recently? Tesla reported a 13.5% drop in global deliveries in the second quarter of 2025, reflecting a slowdown in the electric vehicle market.
What are the prospects for India’s electric vehicle market? Although the market is growing, it remains small, with EV sales comprising less than 3% of total car sales in 2024.
In conclusion, the launch of Tesla in India presents both a promising opportunity and significant challenges. As stakeholders watch closely, the outcomes could set the tone for the future of electric vehicles in the country. For more insights and information on evolving automotive trends, feel free to explore additional content at Moyens I/O.