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Tesla opens largest India hub amid sluggish sales in key market
Tesla inaugurated its largest sales and service center in Gurugram, India, on Thursday, consolidating showroom, charging, and after-sales operations under one roof-even as the electric vehicle giant grapples with weak demand in Asia's third-largest economy.
Sales struggles in India
Since its high-profile July debut, Tesla has sold just over 100 vehicles in India, according to dealership data obtained by the BBC. Bookings reached barely 600 units by mid-September, with only a fraction converting to deliveries since September began. Competitors like BMW, BYD, and Mercedes-Benz, meanwhile, reported strong premium-segment sales during the festive season, aided by tax incentives.
Industry experts cite high import taxes and slow EV adoption as persistent barriers. Tesla's steep upfront pricing-its Model Y starts at around 6 million rupees ($70,000; £53,000)-adds to the challenge. Yet company officials argue long-term savings offset costs: buyers could recoup up to 2 million rupees ($22,400; £16,900) over four years through fuel and maintenance savings, claimed Sharad Agarwal, Tesla's India head, at the Gurugram center's launch.
"Most maintenance is handled remotely via software updates, cutting ownership costs. Home charging costs one-tenth of petrol prices."
Sharad Agarwal, Tesla India head
Strategy shift: Ecosystem over volume
Sources close to Tesla told the BBC the company is prioritizing India's EV infrastructure to spur adoption. Plans include expanding charging networks-currently around 25,000 stations nationwide-and enhancing customer experience. Tesla's vehicles can add 44 miles (70.8 km) of range per hour via home charging, with superchargers delivering 170 miles in 15 minutes.
Hormazd Sorabjee, editor of Autocar India, called Tesla's sales "low by any standard" but suggested a deliberate approach: "They've just put their foot in the door. Potential here is significant over time."
Broader challenges and global slowdown
India's EV market remains nascent, with electric vehicles comprising less than 3% of passenger sales. Tesla's struggles mirror a wider demand slump in its core markets-Europe, China, and the U.S. October profits fell 37% year-over-year, despite record $28 billion (£21 billion) quarterly revenue, as tariffs and R&D costs rose.
In India, Tesla has avoided local manufacturing despite government incentives, opting for an import-led model. Elon Musk's limited engagement contrasts with competitors' investments in domestic production.
Next steps
The Gurugram hub marks Tesla's latest push to revitalize its India presence. Analysts note success hinges on addressing pricing, infrastructure gaps, and consumer hesitation-while navigating a crowded premium segment.
