The Andhra Pradesh government is actively working to attract American electric vehicle (EV) giant Tesla to set up a manufacturing facility in the state. This initiative aligns with Tesla’s plans to produce affordable EVs for the Indian market.
A team from Tesla recently surveyed potential land parcels in the combined Nellore district and parts of Rayalaseema, signalling the company’s serious interest in the region.
Strategic advantages
Andhra Pradesh holds a competitive edge with its vast land resources. The state has already secured around 15,000 acres in the Nellore and Tirupati districts as part of the Visakhapatnam-Chennai Industrial Corridor.
This pre-acquired land could expedite the setup process, making AP a favourable choice for Tesla’s manufacturing needs.
The state also offers logistical benefits, with proximity to Krishnapatnam Port, the upcoming Ramayapatnam Port, and the planned Dagadarthi airport, all of which enhance supply chain efficiency—an essential factor for Tesla.
Tough competition
However, Andhra Pradesh faces stiff competition from Maharashtra, Gujarat, and Tamil Nadu. Maharashtra is pushing for the plant in Pune, where Tesla India Motors and Energy Private Limited is headquartered. Gujarat, with its strong industrial base, and Tamil Nadu, home to several major automobile manufacturers, are also in the race.
Government outreach
The Andhra Pradesh government has stepped up efforts to secure the investment. During a recent visit to the United States, Minister Nara Lokesh held discussions with Tesla representatives in Texas, formally inviting them to invest in the state. The government has also initiated virtual meetings and written communications to highlight potential incentives.
Boost to local manufacturing
Setting up a Tesla unit in India would help the company lower EV costs by avoiding the steep 110% import duty on imported vehicles.
This move would not only boost Tesla’s presence in India’s growing EV market but also bring significant investments and job opportunities to Andhra Pradesh.
If the state succeeds in securing Tesla’s investment, it could strengthen its position as a key player in the global EV sector and attract further investments in green energy and electric mobility.
