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Elon Musk’s Tesla in talks with Mukesh Ambani’s Reliance Industries to set up EV manufacturing plant in India: Report

According to a report in The Hindu Business Line citing sources, the talks for a joint venture between Billionaires Elon Musk and Mukesh Ambani are currently in the initial stages

Electric vehicle (EV) manufacturing giant Tesla is reportedly looking to set up a joint venture with Reliance Industries Limited (RIL) to establish an EV manufacturing arm in India. According to a report in The Hindu Business Line citing sources, the talks for a joint venture between Billionaires Elon Musk and Mukesh Ambani are currently in the initial stages. This comes amid reports that Tesla is sending a team to India to look for suitable locations for their EV manufacturing plant.

A source aware of the development stated that the talks are in the initial stages and have been “ongoing for over a month”. The person added that the development doesn’t imply RIL’s entry into the automobile space. According to the report, the objective of the oil-to-telecom conglomerate is to “build capacities for electric vehicles in India”. 

Another highly placed source with knowledge of the matter said, “While the role of RIL hasn’t been crystalised yet, it is expected that the Indian conglomerate may play a significant hand in establishing the manufacturing facility and the allied ecosystem for Tesla in India.” 

So far, neither Reliance Industries nor Tesla has commented on reports of their talks for a joint venture. 

Last year, RIL, in collaboration with Ashok Leyland, launched India’s first hydrogen internal combustion engine-powered heavy-duty truck. The same year, RIL also unveiled removable and swappable batteries for EVs. 

Apart from an Electric vehicle manufacturing plant, Tesla might later also look at setting up battery plant following the ‘gigafactory’ model it has followed at its plants in California, Texas, Berlin, and Shanghai, where suppliers have set up shop next to or near the mother plant.” 

Notably, Elon Musk and Mukesh Ambani are going to rivals in the telecom sector. Elon Musk’s other venture Starlink, the satellite internet service, is preparing to launch its operations in India, coming in direct competition against Jio telecom of Reliance. Starlink recently has also launched new satellites capable of direct-to-cell capabilities, where the satellites work as cellular telephony towers. This means means mobile phones can connect to the satellites directly, which will be particularly beneficial in areas outsidemobile network coverage.

Tesla begins site search for $3 billion Electric Vehicle Plant in India

Last week, on 3rd April, reports emerged that Tesla Inc. had initiated its search to identify sites for building its proposed $2 billion to $3 billion Electric car plant in India. Reportedly, the EV maker is slated to send its team to India by late April to scout sites. It was said that states like Maharashtra, Gujarat, and Tamil Nadu are on high priority for the company, because of the existing automobile manufacturing ecosystems in these states.

Meanwhile, the CEO of Tesla, Elon Musk recently confirmed his slated entry in India. In an X (formerly Twitter) Spaces session with Nicolai Tangen, CEO of Norges Bank Investment Management, Musk said, “India is now the most populous country in the world, based on population. India should have electric cars just like every other country has electric cars. It’s a natural progression to provide Tesla electric vehicles in India.” 

While the company has been looking at multiple locations, the team’s special focus is on states that already have automobile manufacturing hubs as well as ports to facilitate export, the reports added. For this, states like Maharashtra, Gujarat, and Tamil Nadu are on high priority for the company.

Now, as per sources, Maharashtra could emerge as the preferred location. A source cited above said, “Tesla plans to use the facility for domestic and export purposes, and hence, it may prefer a location suitable for port facilities.” 

Sources, however, added that Tesla’s talks of a joint venture with RIL are not exclusive and it may look for another domestic partner if ongoing talks don’t materialise.

Meanwhile, the Indian government had in March reduced import taxes on certain electric vehicles produced by automakers that commit to invest at least $500 million (Rs 4,150 crores) and start commercial production in the country within three years. The policy aims to position India as a global manufacturing hub for electric vehicles. 

Tesla CEO Elon Musk has been eyeing the Indian market for years but New Delhi has maintained that the EV maker has to commit to local manufacturing. However, the latest decision by the Indian government could pave the way for US electric car maker to make a foray into the Indian automobile manufacturing market. 

Ayodhra Ram Mandir special coverage by OpIndia

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