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2021-08-10

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VW joins Tesla in call for lower import tax on EVs in India

NEW DELHI, Aug 10 (Reuters) - Volkswagen AG , the world's second-largest carmaker, is calling for lo

VW joins Tesla in call for lower import tax on EVs in India

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Development of charging infrastructure will also influence its decision.</p>\n<p>India taxes fully-built imported cars, including EVs, as high as 100%, but the government is discussing a proposal to slash rates to as low as 40%, days after Tesla Inc's appeals for a cut.</p>\n<p>This has triggered fissures in the auto industry, with global players such as Daimler's Mercedes-Benz and Hyundai Motor supporting the proposed cuts, but domestic rivals like Tata Motors opposing them, saying they would hurt India's push to increase local production.</p>\n<p>\"I'm not at all saying that local manufacturing should not be encouraged ... but duty of 60% and 100% is prohibitively high at this juncture,\" said Boparai, adding that to manufacture EVs locally there first needed to be more demand.</p>\n<p>Volkswagen, which aims to overtake Tesla as the world's largest EV maker by 2025, is investing billions of dollars to transition to battery-powered cars, which it expects to account for half of its global vehicle sales by 2030.</p>\n<p>While India, the world's fifth-largest car market, is on Volkswagen's EV map, Boparai expects a lag in electrification compared with Europe and China because of the high price of battery-powered cars and lack of local charging infrastructure.</p>\n<p>In July, Volkswagen began sales of three Audi electric SUVs priced from about $133,0000, putting them out of reach of most buyers in India where 95% of cars are sold for less than $20,000. Next year, it plans to launch its luxury Porsche Taycan EV in India.</p>\n<p>Boparai said he expected demand to begin at the high end of the market and trickle down, as seen in markets like the United States where Tesla dominates electric car sales. But in India there was also a need for affordable EVs and demand for that would begin with ride-hailing or corporate fleets, he added.</p>\n<p>\"Establishing EVs is a lot of hard work. 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Development of charging infrastructure will also influence its decision.\nIndia taxes fully-built imported cars, including EVs, as high as 100%, but the government is discussing a proposal to slash rates to as low as 40%, days after Tesla Inc's appeals for a cut.\nThis has triggered fissures in the auto industry, with global players such as Daimler's Mercedes-Benz and Hyundai Motor supporting the proposed cuts, but domestic rivals like Tata Motors opposing them, saying they would hurt India's push to increase local production.\n\"I'm not at all saying that local manufacturing should not be encouraged ... but duty of 60% and 100% is prohibitively high at this juncture,\" said Boparai, adding that to manufacture EVs locally there first needed to be more demand.\nVolkswagen, which aims to overtake Tesla as the world's largest EV maker by 2025, is investing billions of dollars to transition to battery-powered cars, which it expects to account for half of its global vehicle sales by 2030.\nWhile India, the world's fifth-largest car market, is on Volkswagen's EV map, Boparai expects a lag in electrification compared with Europe and China because of the high price of battery-powered cars and lack of local charging infrastructure.\nIn July, Volkswagen began sales of three Audi electric SUVs priced from about $133,0000, putting them out of reach of most buyers in India where 95% of cars are sold for less than $20,000. Next year, it plans to launch its luxury Porsche Taycan EV in India.\nBoparai said he expected demand to begin at the high end of the market and trickle down, as seen in markets like the United States where Tesla dominates electric car sales. But in India there was also a need for affordable EVs and demand for that would begin with ride-hailing or corporate fleets, he added.\n\"Establishing EVs is a lot of hard work. 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VW joins Tesla in call for lower import tax on EVs in India

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