Tesla News: The Indian government and several states are trying to woo the world's richest businessman Elon Musk. The Economic Times, citing unnamed sources, reported that the central government is making every effort to woo Tesla to manufacture in India. State governments like Gujarat and Tamil Nadu are also trying to bring suppliers making Tesla's products to their states.

The report says this is because Tesla may be more likely to manufacture where its supplier ecosystem is, in order to speed up production and save time and costs spent on transportation.

Tamil Nadu manufacturing hub

According to the report, three component suppliers of Tesla as well as other vehicle manufacturers were in Gujarat. Out of these, two European suppliers are planning to set up their units in Tamil Nadu. Tamil Nadu has already become a hub of automotive and electronics manufacturing, some of Tesla's suppliers are already present there, which produce metal components and rubber parts are jointly produced by a German company.

Partnership with Chinese companies

The report quoted Soumen Mandal, senior research analyst at Counterpoint Research, as saying that Tesla has partnered with BYD and CATL in China for batteries and Panasonic and LG Energy in the US. He said similar strategic supply chain partnerships exist globally for components such as telematics, power cables, LED lights and displays.

What will be the impact on India?

This is beneficial for India as the reduction of US manufacturers' dependence on China has made India a reliable partner to meet growing demands, the report quoted Canalys automotive analyst Ashwin Ambarkar as saying.