Tesla Expands in India with First Full-Scale Center in Gurugram Amid Global Market Challenges

Tesla is preparing to open its first comprehensive center in Gurugram this month, enhancing its presence in India and marking a significant step in its strategy to increase sales and visibility in a market currently dominated by European luxury electric vehicle manufacturers.

This expansion comes as Tesla faces challenges globally, including declining demand in China and investor caution in the United States, making India an increasingly important strategic market. The Gurugram facility follows the earlier establishment of experience centers in Mumbai and Delhi earlier this year.

India recently became Tesla's 50th global market with the introduction of two variants of the fully imported Model Y, with prices starting at Rs 59.89 lakh. Due to a 70 percent import duty, the Model Y in India is among the most expensive globally, approximately 30 percent higher than its pricing in the United States.

Despite the premium pricing, initial market response has been impressive. According to data from the Federation of Automobile Dealers Association, Tesla registered 104 retail units during September and October, as recorded on the Vahan portal.

The company is relying on its new India head, Sharad Agarwal, to build momentum in the market. Agarwal, who assumed the position last November, brings nearly a decade of luxury automotive experience, having previously led Lamborghini India and served as head of sales at Audi India.

His appointment demonstrates Tesla's commitment to expanding in a market where German competitors Mercedes-Benz and BMW currently control approximately 80 percent of luxury electric vehicle sales.

The timing is strategic. Tesla's global sales increased by just 7 percent year-on-year to 497,100 units in the September quarter, while deliveries in China fell to a three-year low of 26,006 units in October amid increasing competition and decreasing demand.

The premium electric vehicle sector is becoming increasingly competitive, with Tesla's primary rivals in India including the BMW iX1, Mercedes-Benz EQA, Volvo EC40, Kia EV6, and BYD Sealion 7 in a segment that recorded sales of 460 to 480 units in October alone.