Reducing duties on electric vehicles even to 25% – from existing levels as high as 100% – would not pose a “big threat” to regional players, but would help to drive investment, the German automaker’s India head informed Reuters in an interview.
Volkswagen is exploring ways to launch EVs in India from its Volkswagen and Skoda brands, but would need to see lower import duties, stable policies on taxation, and long-term incentives before taking any action, Boparai said. The development of charging infrastructure will also affect its decision.
India taxes fully-built imported cars, including EVs, as high as 100%, but the government is discussing a proposal to decrease rates to as low as 40%, days after Tesla Inc’s asked for a cut.
Other international automakers such as Daimler’s Mercedes-Benz and Hyundai Motor are also supporting the proposed cuts, but domestic automakers like Tata Motors, the owner of Jaguar Land Rover, is opposing them, saying they would negatively impact India’s push to increase local production.