Tesla has again begun its hunt for a showroom location in New Delhi, which might be a sign of having a change of heart regarding entering the Indian market. This is after a time of uncertainty earlier this year when the company put its expansion efforts in India on hold. 

As reported by two people with direct knowledge of the matter, Tesla has just entered into initial talks with DLF, the largest developer in India, to stake a showroom claim in the country’s capital region. Earlier in April, it had decided to enter Indian markets, setting up a $2-3 billion investment. But that plan was put off with Elon Musk’s cancelled India visit. Musk intended to meet Indian Prime Minister Narendra Modi, but he made it stay when Tesla postponed the visit considering the internal restructuring measures. This included laying off 10% of their staff amid declining sales. 

Tesla is reportedly looking to open a consumer experience center in New Delhi. The company is seeking locations with space ranging from 3,000 square feet to 5,000 square feet for the center. It is also on the lookout for bigger locations up to 15,000 square feet for its delivery and service operations. The company may look at DLF’s Avenue Mall in southern Delhi or at the Cyber Hub in Gurgaon. 

Although Tesla is in talks with DLF, the discussions are at a very preliminary stage, and the deal is not yet confirmed. Tesla is also looking for other real estate in the region. According to one of the sources, Tesla is interested in taking a showroom space of about 8,000 square feet at Avenue Mall, which is a commercial space that accommodates international retailers such as Uniqlo, Mango, and Marks & Spencer. 

Even as Tesla renews interest in India, it is still unclear if the company will import vehicles at the country’s high tax rate of up to 100% or make investment commitments that would enable it to take advantage of a reduced import duty rate of 15%, under India’s new EV policy. 

The Indian government is working actively to attract foreign automakers such as Hyundai and Toyota to expand their electric vehicle operations in India as the government looks to increase the share of electric vehicles in the market to 30% by 2030. Today, EVs account for only 2% of the total car sales in India that had reached 4 million units last year. Tesla is also looking for showrooms as it prepares to launch its Starlink satellite internet service in India after a regulatory win against Indian billionaire Mukesh Ambani over spectrum allocation for the service.