Context :
Govt
Wants Tesla To Buy Local Auto Parts Worth $500 /
abplive / 16 Feb 2022
Extract :
The government wants Tesla Inc to
commit sourcing at least $500 million of auto components from India for the
electric carmaker’s request for an import tax cut on its vehicles to be
considered, Bloomberg reported quoting a source in the know.
According to the report, Tesla would need to agree to ramp up Indian parts purchases by around 10 per cent to 15 per cent a year until a satisfactory level was
achieved, the person said, asking not to be named because the discussions are
private.
The Centre has formally told Tesla to ramp up domestic sourcing,
but is yet to relay a procurement target to the company, the person said. Tesla
in August claimed it sourced around $100 million in parts from India.
The government has said it is keen for
Tesla to make cars in the country, but appears to be using their interest to
try and gain benefits for the Indian industry.
To progress on its tax-cut bid, Tesla
must approach the government with a component-sourcing plan
that’s proportional to its car sales forecast in India, the person said. It
should also export made-in-India components to China if it plans to import cars
from there, the person told Bloomberg.
Tesla and a representative for India’s
ministry of transport didn’t respond to requests for comment.
===================================================
MY TAKE :
Hey
Elon , What is so difficult ?........................... [ 15 Aug 2021 ]
Extract :
Obviously, GOI would want any Foreign
Manufacturer to gradually increase “ local value
addition “, to take it to ( say ), 90 % over a 5 Year period , leaving only
10 % ( by value ) imported items at the end of 5 years
I urge, Tesla to examine following
program – and if feasible send it (with changes if required ), to GOI
This could form a basis for further
discussions / finalization
If an agreement is reached, it would
serve as a BENCH-MARK for
all other Foreign Manufacturers wanting to make / sell, electric vehicles in
India
Tesla
to commit to following PHASED
MANUFACTURING PROGRAM for making Model 3 in India
|
Year ( Ap-Mar) |
Items to be procured locally |
Value Addition % ( For the Year ) |
Value Addition % ( Cumulative ) |
|
|
|
|
|
|
22 - 23 |
NIL
( Import of fully assembled cars ) |
- |
- |
|
|
|
|
|
|
23 - 24 |
KDU
– Knocked Down Units ( Add Assy Hours ) |
5 |
5 |
|
|
|
|
|
|
24 - 25 |
Tyres / Chasis / Body / Electricals / Windows /
Dashboards ..etc |
10 |
15 |
|
|
|
|
|
|
25 - 26 |
Li-ion Battery |
40 |
55 |
|
|
|
|
|
|
26 - 27 |
Sensors -
Cameras – GPS locators |
15 |
70 |
|
|
|
|
|
|
27 - 28 |
Autonomous Navigation Devices ( Radar – Lidar ) |
20 |
90 |
Ø Above
mentioned list of components / sub-assys / Assys etc., is only illustrative.
Tesla may expand
Ø For each
component / sub-assy.,Tesla would need to provide CIF prices ( $ and Rs ), if
imported , and providing names of its own current suppliers of each (
country-wise )
Ø Value
Addition must be shown as a percentage of
the final Ex-Factory selling price of Model 3
Ø In case
of depreciation of Rupee vis-à-vis Dollar , local value addition must not
suffer ( get reduced )
Ø Tesla
should file with GOI, a quarterly RETURN , showing current value addition and
cars sold
Dear
Elon ( press@tesla.com ),
Ø You
claim that Tesla purchased from India, parts worth $ 100 million, SO FAR
Ø Assuming
that these purchase covered past 2 years, that works out to $ 50 million / year
Ø I
further assume that , during 2022 – 23, you will import / sell some 5,000 Model 3 in India, for a total CIF value of $ 200 million ( @ $ 40,000 per car )
Ø Dividing
$ 50 million by $ 200 million = 25 %
Ø Goes
to show that, if the same parts were used for “ locally assembled “ cars, it
would amount to a “ local
value addition “ of ( as high as
) 25 % , in the very FIRST YEAR itself
!
I urge your Business Development Team,
to go through my following earlier e-mails to help formulate your ENTRY
STRATEGY for India
With regards,
Hemen Parekh
/ hcp@RecruitGuru.com / 17 Feb 2022