Tesla’s stock could explode due to Indian expansion. Musk just has to negotiate.

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A quick look at today’s report on Tesla (NASDAQ:TSLA) could upset the investor. Tesla’s share has been declining all day. At first glance, it might be appealing to attribute these declines to the perceived delay of the long-awaited Cybertruck company. The internet has been buzzing ever since discovered the news that the electric vehicle (EV) innovator removed the truck date 2022 from its website. A macro look, however, reveals a broader picture. The S&P 500 it declines all afternoon. Shares of electric vehicles are falling in all areas, including Tesla’s competitors Rivian (NASDAQ:RIVN) in Lucid Motors (NASDAQ:LCID). Trend oz Electric vehicle stocks are declining we saw earlier this week, don’t stop.

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What’s going on with the Tesla stock

Of that writing, Tesla shares fell nearly 5% a day. However, investors should not worry. Today also brought the news that the company is working on a launch in India. After a tweet in which Musk stated he was “Working through many challenges” with the Indian government, the internet is full of speculation about what enlargement to India could mean.

It seems that such a development is likely to bring some important new drivers for Tesla shares for the company. Let’s take a closer look at what investors can expect.

The way forward

It’s not hard to understand why Musk would focus on India. The country is the fifth largest car market in the world, but this is not the most tempting detail. The size of the Indian EV market is expected to grow $ 152.21 billion by 2030, representing a total annual growth rate (CAGR) of 94.4%. Demand is high and only increasing. Manufacturers of electric vehicles with significant production capacity will have a significant market in the twist. What’s more, Tesla is taking consistent steps in the direction of increasing its production. The company is in a good position to provide a large part of the growing Indian EV market.

This does not mean that there will be no obstacles. The most likely challenge Musk has avoided is India’s high import duties. This is a constant limitation for car manufacturers. Business Insider reports that state taxes »60% on EVs, costing $ 40,000 or less and 100% for those over $ 40,000. “

The Business Times reports held by the Government of India refuted Musk’s claims. The articles also state that the Indian government has introduced a policy-related insurance scheme specifically for the EV sector. Such a policy, they argue, would benefit companies like Tesla.

We must not forget that other governments were willing to play with the ball when Musk wants to close the deal. Chinese President Xi Jinping is not known for being friendly to American companies, but he was prepared rewrite some of the rules of your country to attract Musk set up shop there. The Indian government will have an incentive to do the same as its country’s demand for electric vehicles continues to grow.

Bottom Line on Tesla shares

As can be seen from here, the Indian government will reach an agreement with Musk next year. In fact, Tesla’s deals in China have proven to be very rewarding. Therefore, India is the next logical market to be launched. When an agreement is reached, Tesla’s shares will rise.

This important agreement may still be the way out. Until then, however, investors should look to India. It will be a partnership that will determine the year whenever it happens.

At the time of publication, Samuel O’Brient did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are the opinions of the writer who are the subject InvestorPlace.com Guidelines for publication.

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