{"id":25000,"date":"2023-09-14T15:00:24","date_gmt":"2023-09-14T09:30:24","guid":{"rendered":"https:\/\/blog.researchandranking.com\/?p=25000"},"modified":"2023-09-27T11:13:13","modified_gmt":"2023-09-27T05:43:13","slug":"teslas-ambitious-move-1-9-billion-auto-component-deal-with-india","status":"publish","type":"post","link":"https:\/\/www.equentis.com\/blog\/teslas-ambitious-move-1-9-billion-auto-component-deal-with-india\/","title":{"rendered":"Tesla&#8217;s Ambitious Move: $1.9 Billion Auto Component Deal with India"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div><div class=\"wp-block-post-date\"><time datetime=\"2023-09-14T15:00:24+05:30\">September 14, 2023<\/time><\/div>\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Introduction<\/h2>\n\n\n\n<p>In a game-changing move for India&#8217;s automotive industry, Tesla, the electric vehicle powerhouse, is poised to make a significant impact. Beyond entering the Indian market, Tesla has set its sights on procuring an impressive $1.9 billion of auto components from India this year.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe title=\"India to Supply Auto Parts to Tesla\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/xDMKMaWaaZk?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">The Past and Present of Tesla in India<\/h3>\n\n\n\n<p><strong>A Stalled Attempt<\/strong><\/p>\n\n\n\n<p>In 2021, Tesla&#8217;s initial foray into the Indian market faced a significant roadblock. The disagreement arose over tariffs: Tesla sought lower import duties on cars, while the Indian government insisted on local manufacturing. Fast forward, Elon Musk has affirmed Tesla&#8217;s imminent presence in India, vowing to make it happen &#8220;as soon as possible.&#8221;<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-full is-resized\"><img fetchpriority=\"high\" decoding=\"async\" src=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-72.png\" alt=\"\" class=\"wp-image-25005\" style=\"width:698px;height:137px\" width=\"698\" height=\"137\" title=\"\" srcset=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-72.png 940w, https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-72-300x59.png 300w, https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-72-768x151.png 768w\" sizes=\"(max-width: 698px) 100vw, 698px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Piyush Goyal&#8217;s Affirmation<\/h3>\n\n\n\n<p>During a pivotal address at the Automotive Component Manufacturers Association (ACMA), Union Commerce Minister Piyush Goyal underscored Tesla&#8217;s key role as a significant purchaser of Indian auto components. Astonishingly, Tesla imported auto parts worth a staggering $1 billion from India last year, with this year&#8217;s target set between $1.7 billion and $1.9 billion.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">India&#8217;s Rising Auto Component Industry<\/h3>\n\n\n\n<p>According to Grant Thornton, India&#8217;s auto component industry is poised for exponential growth in consumption and exports over the next decade. Notably, this sector, contributing 2.3 percent to the nation&#8217;s GDP, is on track to become the world&#8217;s third-largest by 2025. <\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-73.png\" alt=\"\" class=\"wp-image-25006\" style=\"width:570px;height:245px\" width=\"570\" height=\"245\" title=\"\" srcset=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-73.png 745w, https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-73-300x129.png 300w\" sizes=\"(max-width: 570px) 100vw, 570px\" \/><figcaption class=\"wp-element-caption\">Source: Grant Thornton<\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Key Takeaways<\/h2>\n\n\n\n<p><strong>A Local Manufacturing Facility<\/strong><\/p>\n\n\n\n<p>Tesla is eyeing the establishment of a domestic manufacturing facility, focusing on producing electric vehicles priced at approximately $24,000, or around Rs 20 lakh, to cater specifically to the Indian market and also facilitate exports. This strategic shift demonstrates Tesla&#8217;s readiness to engage in local production within India, surmounting previous hurdles related to import taxes on EVs.<\/p>\n\n\n\n<p><strong>Aligning with &#8220;Make In India&#8221;<\/strong><\/p>\n\n\n\n<p>Moreover, this move resonates with the broader &#8220;Make In India&#8221; initiative and the broader push for local manufacturing, which promises manifold advantages for the Indian economy.<\/p>\n\n\n\n<p>Tesla&#8217;s monumental step towards sourcing $1.9 billion worth of auto components from India not only signifies a significant boost for the Indian automotive industry but also aligns with the <a href=\"https:\/\/www.equentis.com\/blog\/key-global-events-that-can-influence-the-stock-market-this-week-3\/\">global<\/a> trend toward electrification. This development underscores Tesla&#8217;s commitment to local production and its resolve to contribute to India&#8217;s economic growth.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">FAQs<\/h3>\n\n\n\n<h2 class=\"wp-block-heading has-text-align-center has-white-color has-midnight-gradient-background has-text-color has-background has-medium-font-size\">Is Inflation getting worse for the US?<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Introduction<\/h3>\n\n\n\n<p><a href=\"https:\/\/www.equentis.com\/blog\/10-common-effects-of-inflation-on-the-economy\/\">Inflation<\/a> has become a pressing concern for the US economy, persisting at elevated levels for several months. However, recent data indicates a notable improvement, with figures dropping from a staggering 9.1%, the highest in 40 years.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Understanding the Consumer Price Index (CPI)<\/h3>\n\n\n\n<p>The Consumer Price Index, commonly called CPI, revealed a year-on-year increase of 3.7% in August. This marks a slight acceleration compared to the 3.2% gain recorded earlier. Economists were slightly surprised, as the figure of 3.6% exceeded their predictions.<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-full is-resized\"><img decoding=\"async\" src=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-74.png\" alt=\"\" class=\"wp-image-25008\" style=\"width:664px;height:349px\" width=\"664\" height=\"349\" title=\"\" srcset=\"https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-74.png 942w, https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-74-300x158.png 300w, https:\/\/www.equentis.com\/blog\/wp-content\/uploads\/2023\/09\/image-74-768x404.png 768w\" sizes=\"(max-width: 664px) 100vw, 664px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Energy Commodities and Inflation<\/h3>\n\n\n\n<p>A significant driver of this inflation surge is the soaring prices of energy commodities, such as gas and oil. In a startling month-on-month increase, these prices surged by 10.5%. Notably, gas prices experienced a sharp spike in August, attributed to aggressive supply cuts by Russia and Saudi Arabia. This move propelled the price of crude oil to a 10-month high, settling at $91 a barrel. Intriguingly, the surge in gas prices accounted for over half of the overall inflation rate increase. <\/p>\n\n\n\n<div class=\"wp-block-group is-layout-constrained wp-block-group-is-layout-constrained\">\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-28f84493 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\" style=\"flex-basis:100%\">\n<figure class=\"wp-block-table aligncenter is-style-regular\"><table class=\"has-white-color has-secondary-background-color has-text-color has-background\"><tbody><tr><td><strong>&nbsp;<\/strong><\/td><td><strong>August M\/M<\/strong><\/td><td><strong>August Y\/Y<\/strong><\/td><\/tr><tr><td><strong>All items<\/strong><\/td><td><strong>0.6<\/strong><\/td><td><strong>3.7<\/strong><\/td><\/tr><tr><td><strong>Food<\/strong><\/td><td><strong>0.2<\/strong><\/td><td><strong>4.3<\/strong><\/td><\/tr><tr><td><strong>Energy<\/strong><\/td><td><strong>5.6<\/strong><\/td><td><strong>-3.6<\/strong><\/td><\/tr><tr><td><strong>Energy commodities<\/strong><\/td><td><strong>10.5<\/strong><\/td><td><strong>-4.2<\/strong><\/td><\/tr><tr><td><strong>Gasoline (all types)<\/strong><\/td><td><strong>10.6<\/strong><\/td><td><strong>-3.3<\/strong><\/td><\/tr><tr><td><strong>Fuel oil<\/strong><\/td><td><strong>9.1<\/strong><\/td><td><strong>-14.8<\/strong><\/td><\/tr><tr><td><strong>Energy services<\/strong><\/td><td><strong>0.2<\/strong><\/td><td><strong>-2.7<\/strong><\/td><\/tr><tr><td><strong>Electricity<\/strong><\/td><td><strong>0.2<\/strong><\/td><td><strong>2.1<\/strong><\/td><\/tr><tr><td><strong>Utility (piped) gas service<\/strong><\/td><td><strong>0.1<\/strong><\/td><td><strong>-16.5<\/strong><\/td><\/tr><tr><td><strong>All items less food and energy<\/strong><\/td><td><strong>0.3<\/strong><\/td><td><strong>4.3<\/strong><\/td><\/tr><tr><td><strong>Commodities less food and energy commodities<\/strong><\/td><td><strong>-0.1<\/strong><\/td><td><strong>0.2<\/strong><\/td><\/tr><tr><td><strong>New vehicles<\/strong><\/td><td><strong>0.3<\/strong><\/td><td><strong>2.9<\/strong><\/td><\/tr><tr><td><strong>Used cars and trucks<\/strong><\/td><td><strong>-1.2<\/strong><\/td><td><strong>-6.6<\/strong><\/td><\/tr><tr><td><strong>Apparel<\/strong><\/td><td><strong>0.2<\/strong><\/td><td><strong>3.1<\/strong><\/td><\/tr><tr><td><strong>Medical care commodities<\/strong><\/td><td><strong>0.6<\/strong><\/td><td><strong>4.5<\/strong><\/td><\/tr><tr><td><strong>Services less energy services<\/strong><\/td><td><strong>0.4<\/strong><\/td><td><strong>5.9<\/strong><\/td><\/tr><tr><td><strong>Shelter<\/strong><\/td><td><strong>0.3<\/strong><\/td><td><strong>7.3<\/strong><\/td><\/tr><tr><td><strong>Transportation services<\/strong><\/td><td><strong>2<\/strong><\/td><td><strong>10.3<\/strong><\/td><\/tr><tr><td><strong>Medical care services<\/strong><\/td><td><strong>0.1<\/strong><\/td><td><strong>-2.1<\/strong><\/td><\/tr><\/tbody><\/table><\/figure>\n<\/div>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Analyzing Core Inflation<\/h3>\n<\/div>\n\n\n\n<p>Looking closer at the core inflation, which excludes the more volatile costs of food and gas, prices in August still declined to 4.3% compared to the previous year. While this reflects a slight slowdown from the 4.7% annual increase in July, it remains noteworthy.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">The Federal Reserve&#8217;s Dilemma<\/h3>\n\n\n\n<p>The crucial question is how the Federal Reserve will respond to this ongoing inflationary trend. Inflation has consistently exceeded their 2% target, and coupled with the rise in oil prices and a job market that, while not as robust as before, remains relatively tight, there is apprehension that the Fed may opt to raise interest <a href=\"https:\/\/www.equentis.com\/blog\/old-tax-regime-slabs\/\">rates<\/a> later in the year. To provide context, they already implemented a 0.25% rate increase in July, following a brief hiatus in June.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Market Sentiment and Future Projections<\/h3>\n\n\n\n<p>In light of the recent data, <a href=\"https:\/\/www.equentis.com\/blog\/what-is-market-sentiment-how-to-analyse-it\/\">market sentiment<\/a> indicates a strong likelihood, with a 95% probability, that the Federal Reserve will maintain the current interest rates during its forthcoming policy meeting on September 20.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">FAQs<\/h3>\n\n\n<div class=\"saswp-faq-block-section\"><ol style=\"list-style-type:none\"><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>What caused the disagreement between Tesla and the Indian government in 2021?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">In 2021, a disagreement arose over tariffs. Tesla sought lower import duties on cars, while the Indian government insisted on local manufacturing.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>How much did Tesla import in auto component parts from India last year?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">Tesla imported auto component parts worth a staggering $1 billion from India last year.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>What is the projected growth for India&#8217;s auto components industry in the next decade?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">India&#8217;s auto components industry is projected to witness exponential growth in consumption and exports over the next decade.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>What percentage does India&#8217;s auto components sector contribute to the nation&#8217;s GDP?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">The auto components sector contributes 2.3 percent to India&#8217;s GDP.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>What is Tesla&#8217;s target price for EVs geared towards the Indian market?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">Tesla aims to produce EVs priced at around $24,000, or approximately Rs 20 lakh, for the Indian market.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong><strong>What is the Consumer Price Index (CPI)?<\/strong><\/strong><\/h5><p class=\"saswp-faq-answer-text\">The Consumer Price Index is a measure that examines the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.<\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong><strong>What are core inflation rates?<\/strong><\/strong><\/h5><p class=\"saswp-faq-answer-text\">Core inflation rates exclude certain volatile elements, like food and energy prices, providing a more stable measure of inflation. <\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>How do energy prices affect inflation?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">Energy prices, particularly those of commodities like gas and oil, can significantly impact inflation rates. Sudden spikes in these prices can lead to overall inflationary pressure. <\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong>What is the Federal Reserve&#8217;s target for inflation?<\/strong><\/h5><p class=\"saswp-faq-answer-text\">The Federal Reserve aims for a target inflation rate of 2%, as it is generally considered conducive to a healthy, growing economy. <\/p><li style=\"list-style-type: none\"><h5 class=\"saswp-faq-question-title \"><strong><strong>How do interest rate hikes affect inflation?<\/strong><\/strong><\/h5><p class=\"saswp-faq-answer-text\">Raising interest rates can be a tool used by central banks, like the Federal Reserve, to help curb inflation. Higher interest rates can reduce borrowing and spending, which can, in turn, help moderate inflationary pressures.<\/p><\/ul><\/div>","protected":false},"excerpt":{"rendered":"<p>Introduction In a game-changing move for India&#8217;s automotive industry, Tesla, the electric vehicle powerhouse, is poised to make a significant [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":25001,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[948],"tags":[],"class_list":["post-25000","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-market-news"],"_links":{"self":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts\/25000","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/comments?post=25000"}],"version-history":[{"count":0,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts\/25000\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/media\/25001"}],"wp:attachment":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/media?parent=25000"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/categories?post=25000"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/tags?post=25000"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}