After putting off India visit, Tesla CEO Elon Musk lands in China
After putting off India visit, Tesla CEO Elon Musk lands in China
Tesla CEO Elon Musk on Sunday arrived in China, barely a week after he scrapped his much anticipated India visit to meet Prime Minister Narendra Modi and founders of an Indian space startup citing “Tesla related” commitments”.
Amid a sharp decline in production Tesla units and questions raised by its inventors, Musk is expected to discuss the roll out of Tela’s Full Self-Driving software and permission to transfer data overseas with Chinese government officials, Reuters said in a report.
Musk has been looking to obtain approval to transfer data collected in China to train algorithms for its autonomous driving technologies. The company since 2021 has been storing all data collected by its Chinese fleet in Shanghai as required by Chinese regulators.
While New Delhi has only rolled out an electric vehicle policy (EV) last month, largely to accommodate the Texas-based carmaker, Tesla operates its biggest plant globally in Shanghai, producing over 1 million units of Model 3 and Model Y cars a year.
Tesla has sold more than 1.7 million cars in China since it entered the market a decade ago. Moreover, China is also crucial for Tesla as it supplies its cars to New Zealand, Australia and Europe.
Reuters reported that Musk’s visit coincides with the Beijing auto show, which opened last week and ends on May 4. Musk’s itinerary on Sunday afternoon also includes a meeting with Ren Hongbin, a government official who heads the China Council for the Promotion of International Trade, the organiser of the Beijing auto show currently underway, Chinese state media has reported.
Prior to Musk’s visit to India, policymakers had kickstarted the consultation process to release guidelines for the EV policy. Hours after Musk announced that he is postponing his visit to India, Union Finance Minister Nirmala Sitharaman had said that India is making policies to ensure big companies are attracted to India for investment, especially in light of industries expressing concerns around China.
To attract investments into the EV space, the Centre has lowered import duties to 15 per cent from 100 per cent for models of electric cars with a combined cost, insurance, freight prices of $35,000 or above for five years, a key precondition for Tesla’s entry to test out the “market potential” in India.
Earlier, Centre is learnt to have turned down China-based BYD’s proposal to build a $1-billion EV plant in partnership with Hyderabad-based Megha Engineering and Infrastructures Ltd last year in June. The rejection of the proposal was in line with India’s broad policy to filter Chinese investments in crucial sectors in India.
A vibrant EV ecosystem is part of India’s policy push to help reduce extreme dependence on imported crude oil. India’s oil import dependency for FY24 climbed to 87.7 per cent from 87.4 per cent in FY23, as per official numbers. Cutting costly oil imports continues to be a key focus area for the government, and it even found a mention in the BJP manifesto for the 2024 polls.
A similar strategy was seen in the case of mobile manufacturing where Apple and other global mobile phone manufacturers are receiving incentives under the Production Linked Incentive Scheme (PLI) to begin making phones in India and help create a broader manufacturing base in the country.
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