Chinese giant BYD, number one in global EV sales, has made significant inroads into India with cars priced at ₹25-55 lakh. Similarly, Vietnam’s Vinfast plans to introduce two premium electric SUVs—VF 6 and VF 7—in India by the second half of 2025, priced at ₹35-50 lakh. Tesla’s potential entry with its popular Model 3 and Model Y, priced from $44,000 to $61,630 (₹38-53 lakh), are expected to be major contenders in the premium EV space.
With markets such as China and Europe showing signs of saturation, BYD, with a 16.8% market share, and Tesla, with 16.6%, are both eyeing India as a crucial market for sustaining their growth amid the broader global slowdown.
India represents one of the few markets globally where a sustained high-growth trajectory is expected, with sub-3% electric passenger vehicle penetration and as-yet limited charging infrastructure.
A proposed duty rationalisation, combined with rising consumer acceptance in metro cities, could be the catalyst that accelerates adoption in tier II-III markets, said Ravi Bhatia, president at Jato Dynamics.
The Centre announced the Scheme for Manufacturing Electric Cars in March last year to encourage investment in local manufacturing of high-end electric cars. Imports of completely built-up electric cars that have a minimum cost, insurance and freight value of $35,000 at 15% import duty for five years will be allowed, if companies make a minimum investment of $500 million to start manufacturing locally.
Recognising the country’s vast potential, global players are initially focusing on the premium segment, where growth prospects are promising, despite the market’s overall price sensitivity.
By following such a ‘top-down’ strategy, these manufacturers aim to position themselves as luxury EV brands before targeting mass market.
BYD—with its impressive track record of 1.77 million units sold globally—“is focusing on the premium EV segment, having expanded to 40 showrooms across India, with plans for further expansion to meet growing demand,” said a company spokesperson.
The China-headquartered EV manufacturer recently launched the Sealion 7 eSUV at ₹55 lakh and has garnered over 1,000 bookings.
Similarly, Vinfast’s premium SUVs will be locally assembled at its upcoming plant in Thoothukudi, Tamil Nadu. Chief executive Pham Sanh Chau recently stated that these models will be “game changers” that will help accelerate EV adoption in the country.
Tesla’s potential entry, meanwhile, hangs in the balance. Despite India’s proposal to lower electric car import duties from 110% to 15%, chief executive Elon Musk has expressed reservations about local manufacturing.
Washington’s political concerns about New Delhi’s tariffs further complicate the situation. Also, US President Donald Trump has said that if Tesla builds a factory in India, it would be “unfair” to the US.
As of now, Tesla plans to begin selling imported cars through showrooms in Mumbai and Delhi. The company’s long-term plans hinge on India’s ability to offer more favourable tariffs for manufacturers willing to commit to local production, said experts.
The policy landscape is playing a crucial role in shaping this shift. The government’s decision to cut GST on electric automobiles to 5% and its proposed reduction in import duties are designed to stimulate the market.
However, Tesla remains cautious, noting that new regulations require a minimum turnover to qualify for reduced tariffs, adding complexity to its entry.
