Photo: Panasonic | Edited
Tesla is rumored to announce a new EV gigafactory in India, and rumors gained more weight as Panasonic started talks for a local battery plant. Tesla will have to establish a supply chain before starting production at the upcoming Giga India, and securing the battery supply is the most crucial step.
Tesla and India have courted each other for almost three years, although they never agreed on a plan together. Tesla wanted to test the market by selling imported EVs before committing to local manufacturing. On the other hand, India is averse to imports, especially imports from China, its eternal rival. Musk met the Indian prime minister Narendra Modi in June in a bid to reboot the relationship, and it appears that the talks were successful. Following the meeting, Musk announced that Tesla would be in India "as soon as humanly possible," a message that conveyed a sense of urgency.
Last week, the Indian media reported detailed plans to build a Tesla gigafactory in the country. This means that Elon Musk bowed to India's conditions and is now moving to produce electric vehicles there. Not just any EVs but the upcoming affordable model developed on Tesla's Gen-3 architecture. This should start its career at Tesla's all-new gigafactory in Mexico, where the unboxed manufacturing process will be pioneered.
Tesla is undoubtedly considering copy-pasting Giga Mexico in India, although at a smaller scale. Instead of the 2-million-a-year production capacity of Giga Mexico, the Indian factory will start with 500,000 units per year. This is still more than most traditional car plants produce in a year, but likely not enough for a volume model sold in a region that is only now warming up to the EV idea. Tesla has already urged its Chinese suppliers to plan production in Mexico and would want to do the same in India, with a twist.
Given the rivalry between China and India, I doubt Tesla could replicate the supply chain from Giga Shanghai and Giga Mexico to India. We'll have to wait and see, but until then, the first Tesla suppliers have already started talks with the Indian government. Panasonic aims to access government funds to start battery cell production in the country through the Production Linked Incentive Scheme (PLI) program.
Under the scheme, the government selected four companies to produce so-called Advanced Chemistry Cell (ACC) batteries. Hyundai was one of them, but it withdrew from the program. Panasonic is believed to replace it, with allotted benefits for a 20 GWh manufacturing capacity. Considering a 50-kWh battery pack per EV, this would be enough for 400,000 electric vehicles or 500,000 EVs with a 40-kWh battery pack. The Gen-3 EVs will be affordable cars, so it's not hard to imagine that the government subsidies match Giga India's production.
Last week, the Indian media reported detailed plans to build a Tesla gigafactory in the country. This means that Elon Musk bowed to India's conditions and is now moving to produce electric vehicles there. Not just any EVs but the upcoming affordable model developed on Tesla's Gen-3 architecture. This should start its career at Tesla's all-new gigafactory in Mexico, where the unboxed manufacturing process will be pioneered.
Tesla is undoubtedly considering copy-pasting Giga Mexico in India, although at a smaller scale. Instead of the 2-million-a-year production capacity of Giga Mexico, the Indian factory will start with 500,000 units per year. This is still more than most traditional car plants produce in a year, but likely not enough for a volume model sold in a region that is only now warming up to the EV idea. Tesla has already urged its Chinese suppliers to plan production in Mexico and would want to do the same in India, with a twist.
Given the rivalry between China and India, I doubt Tesla could replicate the supply chain from Giga Shanghai and Giga Mexico to India. We'll have to wait and see, but until then, the first Tesla suppliers have already started talks with the Indian government. Panasonic aims to access government funds to start battery cell production in the country through the Production Linked Incentive Scheme (PLI) program.
Under the scheme, the government selected four companies to produce so-called Advanced Chemistry Cell (ACC) batteries. Hyundai was one of them, but it withdrew from the program. Panasonic is believed to replace it, with allotted benefits for a 20 GWh manufacturing capacity. Considering a 50-kWh battery pack per EV, this would be enough for 400,000 electric vehicles or 500,000 EVs with a 40-kWh battery pack. The Gen-3 EVs will be affordable cars, so it's not hard to imagine that the government subsidies match Giga India's production.
Google News