Cheapest Tesla To Cost At Least 4 Lakh More Than Mahindra XEV 9e Even With Lowest Import Duty

Tesla is gearing up for its much-anticipated entry into the Indian market. It now has favourable winds as the government is planning to reduce import duties to below 20%. This, in theory, is expected to enable the US EV giant to price its models competitively. But is the competitive edge for real? Well, as it turns out even the base-spec Tesla could cost more than a fully loaded Mahindra XEV 9e. Let’s discuss the math behind this in detail…

Tesla Model 3 At Least 4 Lakh Pricier Than Mahindra XEV 9e!

In Tesla’s global lineup, the Model 3 is the entry point. In the US market, it is available in three variants- Long Range Rear Wheel Drive (RWD), Long Range All Wheel Drive (AWD) and Performance. For this speculation, let’s consider the lowest-spec- Model 3 Long Range RWD. It has a factory price of 29,990 USD. This translates to 26.12 lakh rupees (1 US Dollar = 87.23 Indian Rupees).

We know that the government is working towards reducing the import duties to below 20%. To be on the safer side, let us consider the final revised duty to be 15%. This would mean that the duty imposed on every unit of the Model 3 would be around $4,498.5 (or 3,91,916 rupees).

Additionally, a freight cost of 2% is also incurred. Thus, for every Model 3 RWD shipped in, $599.8 (Rs 52,255) needs to be paid. The landed price thus would be $35,087.8 or 30.5 lakh rupees. You could call this the ex-showroom price of Model 3 in India.

When a customer buys the car, an additional 5% GST would apply to it. Furthermore, the road tax and insurance would amount to 15% of the vehicle price. In this case, the GST would be around $1754.4 (1.53 lakh) and the road tax and insurance would amount to 4.6 lakh rupees ($5263.1). This would make the total on-road price of a Model 3 climb to 36.6 lakh! This, if you see, is pricier than the recently launched Mahindra XEV 9e. The top-spec Pack 3 variant of the 9e has an on-road price of Rs 32.56 Lakh in Delhi.

What’s more important here is the value proposition. Many would find the Mahindra XEV 9e to offer more value in terms of packaging and cabin live-ability than a Tesla Model 3. We will only be able to cast an authoritative opinion on those after getting to experience the India-spec vehicle first-hand.

Circling back to the Model 3, what we talked about was the entry-level RWD variant. The Long Range AWD and Performance variants have factory prices of $34,990 and $42,490 in the US. The landed prices of these could be around $40,938.5 (35.6 lakh rupees) and 49,712 USD (43.3 lakh INR!) The on-road prices of these could be 42.6 lakh and 52 lakh respectively! To give you more perspective, 50 lakh is roughly what a ‘BYD Seal Premium’ costs in India.

So, Will Tesla Make A Huge Impact In India?

In our considered opinion, Tesla’s entry-level car may not have a huge impact on India’s growing EV mass market segments. Indian buyers are price-sensitive and value-conscious, and Tesla’s premium pricing could limit its reach to a niche segment of luxury EV buyers.

However, it's a totally different story in the premium segments, where the likes of BYD, BMW, Volvo and even Mercedes Benz will feel the heat from Tesla's sharp pricing (thanks to the duty cuts).

Tesla Model 3: Quick Look At It

Since it is one of the earliest Teslas expected on our shores, let’s have a quick look at the Model 3. The single-motor Rear Wheel Drive (RWD) variant is the cheapest and is claimed to offer a range of 363 miles (584 km). It can do the 0-60 mph (0-96 kmph) sprint in just 4.9sec. The Long Range AWD variant is the mid-spec and has a claimed range of 346 miles (556 km) per charge.