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What Kind of Vehicle Would Tesla Make For India?

Will Tesla be able to make a vehicle for India? If so, what would it be like?

Cost of Vehicles For India

India is one of the world's fastest-growing automobile markets and has a population of about 1.4 billion people. There is a huge demand for cars of all types.

Small cars are very popular in India due to their low cost, but there are also sedans and SUVs available.

Let's discuss the cost of these vehicles in India and also explore the potential market for a small car from Tesla.

Cost of Compact Cars in India:

Compact cars are the most popular type of vehicles in India due to their affordability, fuel efficiency, and ease of driving.

The average cost of a compact car in India ranges from ($4,000 to $8,000). Some of the popular compact cars in India include the Maruti Suzuki Alto, Hyundai Santro, Tata Tiago, and Renault Kwid.

Cost of Sedans in India:

Next, there are sedans, which are also a popular vehicle in India. Sedans are a luxury vehicle in India and range from ($11,000 to $20,000). Some of the popular sedans in India include the Honda City, Hyundai Verna, Toyota Corolla, and Skoda Rapid.

Cost of SUVs in India:
SUVs have gained popularity in India in recent years due to their off-road capabilities, spacious interiors, and ruggedness. The average cost of an SUV in India ranges from ($14,000 to $40,000). At the high end, that is not affordable for most people in India. Some of the popular SUVs in India include the Mahindra Thar, Kia Seltos, Hyundai Creta, and Toyota Fortuner.

Potential Market for a Small Tesla Car in India:

If Tesla were to build a small car, it would need to be compact, efficient, and affordable to be successful in the Indian market. India is a price-sensitive market, and customers are always on the lookout for value for money - at a cheap cost. I wrote about the Tesla Model 1 a while ago and it being an option.

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Tesla Model 1

The Tesla Model 1 or whatever name it would end up having would need to be a Tesla still. It would need to be safe and have autonomous software. It could be very small, so long as it was safe. If it was small, Tesla could build it for a cheaper cost and maybe even a single casting if it was just for two passengers.

Tesla would need to get the cost of its batteries down. Let's say the vehicle needed to have 200 miles of range. Let's also say that the efficiency would be such that the vehicle could get about 6 miles of range per kWh. That would mean about a 33.33 kWh battery pack.

If Tesla can get its costs down, which they are continually trying to do, they could build a 33 kWh battery pack for $50 per kWh at $1,650. Then there is the rest of the cost of the vehicle. A Model 3 costs about $133 for a 75 kWh battery pack. This puts the Model 1 at about 62 to 65 percent less the cost of a Model 3.

If we use Giga Shanghai as our benchmark for production, that means we have a car built for under $15,000. The more Tesla can get the battery cost down, the less they will build the car for. If they can get this car built for $10,000, they have a shot at truly hitting the mass market in India for between $12,000 and $15,000 with FSD software.

This is a huge market, and I believe Tesla is going to eventually work to flood this market with a small and compact vehicle that is autonomous. It will all come down to battery supply and battery cost, along with improving manufacturing techniques. Tesla is on the path to doing both of these.

Do you think Tesla could make a mass market vehicle for India?

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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.

Image Credit, Tesla, Screenshot