Tesla has announced its plans to enter the Indian market early next year, but not next month as Elon Musk previously noted.
Tesla Inc (NASDAQ: TSLA) stock jumped approximately 0.29% on Monday to close the day trading at $663.69. Although a negligible tweak, Tesla stocks are set to benefit from the company’s entry into the Indian market early next year. Meanwhile, according to the transport minister of India Nitin Gadkari, Tesla is set to start operations in the country early next year.
At the time of writing in the pre-market, TSLA stock is 0.14% up, trading at $664.59.
However, with no doubt, Tesla stock shareholders have had one of their best years despite the coronavirus outbreak. The market data provided by MarketWatch indicates Tesla stocks have rallied almost sevenfold year to date. Whereby, Tesla stock price has ranged between $70.10 and $695 in the past 52 weeks.
Notably, the company has surpassed a $600 billion market capitalization, whereby at the time of reporting it was valued at $627.29 billion. The average volume in the Tesla stock market has been around 43.79 million.
Having reported one of its best financial year, Tesla is seeking to venture into different global markets and keep up with the increased competition in the EV industry.
Tesla Stock and India
Over the past few years, Tesla has drastically shifted its focus to global markets. Notably, the company has significant influence in the Chinese, Europe, Northern and Southern American electric market.
However, the company has announced its plans to enter the Indian market early next year, but not next month as Elon Musk previously noted.
India is one of the most populous country in the world, however, a majority of the population are considered poor. Interestingly, the country has set out a timeline to which the country’s automobile should entirely embrace the electric vehicle industry. Moreover, it is in line with India’s goal to reduce oil dependency.
As Gadkari told the national daily Indian Express on Monday, Tesla will first seek to sell Model 3 cars before setting out a manufacturing plant depending on the market’s response.
However, there is one major technicality that Tesla is likely to encounter, finding customers for its high end models. With prices starting at over $74,739 (5.5 million Indian rupees), it is expected to have minimal sales per month according to the country’s demand and ability. However, there is a significant portion of city dwellers who have ventured into various businesses and can afford the Tesla prices.
Tesla has in the past expressed interest to venture into the Indian market but encountered stiff government regulations. The country expects Tesla to source a certain portion of its parts in the local market but the company claims there is no such infrastructure in place. “Maybe I’m misinformed, but I was told that 30% of parts must be locally sourced and the supply doesn’t yet exist in India to support that,” Musk tweeted in 2017. Tesla investors will be closely monitoring how the Indian market unfold to advice their portfolio management.