Tata companies become key Tesla supplier, eye bigger role in India expansion: Report

The report suggests that Tata Group companies are eyeing a larger role as Tesla readies its supplier base in India.

“We are very sure that once Tesla starts manufacturing here, Indian suppliers will benefit from sourcing opportunities,” ET quoted a top industry source as saying.

Tesla’s global procurement team has reportedly met with these suppliers to explore the development and production of components such as castings, forgings, electronics, and fabricated parts.

Which Indian companies are key suppliers?

The Tata Group companies are key players in Tesla’s supply chain, contributing to nearly $2 billion in Indian supplies to the US automaker in fiscal year 2024, according to the report.

Tesla is also reportedly procuring components like wiring harnesses, electric motors, gearboxes, and high-value electronics from over a dozen Indian firms, including Samvardhana Motherson, Suprajit Engineering, and Bharat Forge.

While Tesla produces core components like motors and battery packs in-house, it depends on global partners for subassemblies.

Tata AutoComp supplies EV engineering products, Tata Technologies provides product lifecycle management, TCS delivers circuit-board technology, and Tata Electronics is set to supply chips once a local plant, Tesla’s or a third party’s, becomes operational.

As Tesla considers establishing operations nearer its manufacturing hubs, the Tata companies are expected to maintain their global sourcing agreements for now.

However, Tesla’s ultimate decision—whether to manufacture locally or pursue contract manufacturing in India—will determine future steps, the report said.

According to the ET report, Tesla has instructed suppliers for its non-China markets to move production of components outside China and Taiwan by next year. The company is negotiating with states like Gujarat, Tamil Nadu, and Maharashtra to set up a manufacturing base.

Tesla to enter Indian market

Tesla is planning to enter the Indian market with the refreshed Model Y, which will be imported from Germany. The US-based electric vehicle (EV) maker is likely to begin taking bookings in the second quarter of 2025, with deliveries expected in the third quarter.

Tesla will import the pricier Model Y from its Berlin factory as it produces right-hand-drive units. The right-hand-drive Model 3, produced in Shanghai, is unlikely to be part of the initial rollout due to restrictions on Chinese car imports.