Tata AutoComp, Tata Consultancy Services (TCS), Tata Technologies, and Tata Electronics have quietly become major suppliers to Tesla. These companies are preparing for an even bigger role if Tesla expands manufacturing in India, sources reveal.
Tesla Engages with Indian Suppliers
Tesla’s global procurement team has reportedly met with key Indian suppliers to explore manufacturing opportunities. Discussions have focused on components such as castings, forgings, electronics, and fabrication items.
India’s Growing Role in Tesla’s Global Supply Chain
The Tata Group companies have secured global supply agreements with Tesla, contributing to nearly $2 billion worth of components supplied from India in FY24. Tesla is now considering setting up operations closer to its manufacturing hubs to optimize logistics and efficiency.
Tesla Eyes Local Manufacturing and Tax Benefits
Tesla is closely monitoring India’s incentives, tax benefits, and policy changes as it evaluates the feasibility of manufacturing locally. If Tesla sets up a plant in India, it could create significant opportunities for local suppliers.
Expanding Supplier Base in India
Reports suggest that Tesla now sources critical components from more than a dozen Indian companies, including Samvardhana Motherson, Suprajit Engineering, Sona BLW Precision Forgings, Varroc Engineering, Bharat Forge, and Sandhar Technologies. This supplier network is expected to grow further in the coming years.
Tesla Seeks Alternatives to China and Taiwan
Following supply chain disruptions due to COVID-19, Tesla has been diversifying its sourcing strategy. The company has directed suppliers to build parts outside of China and Taiwan, increasing reliance on India for electric motors, gearboxes, powertrains, and high-value electronics.
Potential Tesla Manufacturing Plant in India
Tesla is in discussions with several Indian states—including Rajasthan, Gujarat, Tamil Nadu, Maharashtra, and Telangana—about setting up a manufacturing base. If established, this move could boost India’s EV industry and create new opportunities for domestic suppliers.
India’s EV Market Faces Challenges
While Tesla’s interest in India grows, the domestic EV market is seeing shifts. Tata Motors, India’s top EV seller, has experienced declining sales due to reduced government incentives and increased competition. Despite challenges, India remains a promising market for electric vehicle expansion.
