Tesla(US:TSLA) The Economic Times·2026-01-15 01:11Core Insights - Tesla is facing challenges in the Indian market, struggling to sell approximately 100 of the 300 Model Y vehicles imported four months ago, leading to discounts of up to Rs 2,00,000 ($2,200) on certain variants [1][14] - The company debuted in India in July, relying on brand power to drive sales despite high local import levies of 110% [2][14] - Global sales for Tesla fell in 2025 for the second consecutive year, resulting in a drop behind China's BYD Co. as the top seller of electric vehicles (EVs) [3][14] Market Dynamics - Increasing competition and reduced subsidies in various markets have diminished Tesla's market share in the US, Europe, and China [6] - Indian car buyers have not fully embraced Tesla due to limited visibility and high prices, with only about 600 bookings for the Model Y reported [8][14] - Competitors like BMW and BYD are gaining traction in India, with BMW's sales increasing nearly 200% last year due to the locally assembled iX1 model, while BYD's registrations rose 88% to over 5,400 cars [11][12] Consumer Behavior - Many prospective customers are opting for alternatives after test drives, choosing cheaper options like BMW's iX1 or feature-rich models like BYD's Sealion 7, both priced lower than the Model Y [7][14] - A significant portion of the 600 bookings for the Model Y has not converted into actual deliveries, with only 227 cars registered in India for all of 2025 [9][10][14] - Buyers who initially placed deposits are now hesitant to complete purchases of the lower-priced Model Y, while interest in a more expensive longer-range variant has not translated into timely deliveries [10][14] Strategic Moves - Tesla hired Sharad Agarwal, former head of Lamborghini India, to lead local operations and attract luxury car buyers [6][14] - The company had considered entering the Indian market for nearly a decade, making the decision shortly after a meeting between Elon Musk and Indian Prime Minister Narendra Modi [11][14]