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Donald Trump Calls Tesla’s India Factory Plan ‘Unfair’ to the U.S.
Washington, D.C.: Former U.S. President Donald Trump has voiced concerns over Tesla’s potential factory in India, calling it “unfair” to the United States. Speaking on The Sean Hannity Show on Tuesday, Trump suggested that Tesla could be looking to bypass India’s high import tariffs, which he believes would put American manufacturers at a disadvantage.
His remarks come just a week after Indian Prime Minister Narendra Modi’s visit to the U.S., during which Trump raised the issue of India’s high import duties on cars. However, Trump also expressed openness to finalizing a trade deal and resolving tariff disputes.
Trump and Musk Criticize India’s EV Tariffs
Tesla CEO Elon Musk has previously criticized India’s nearly 100% import tax on electric vehicles (EVs), stating that the tariffs make it nearly “impossible” for Tesla to compete in the Indian market. India’s high tariffs protect local automakers, including Tata Motors, in what is now the third-largest auto market in the world.
Trump echoed Musk’s concerns, stating:
“Every country in the world takes advantage of us, and they do it with tariffs… It is impossible to sell a car, practically, in India.”
Musk responded, confirming:
“The tariffs are like 100% import duty.”
During his conversation with PM Modi, Trump reportedly suggested a reciprocal tariff approach:
“I told Prime Minister Modi yesterday—he was here. I said, ‘Here’s what you do. We’re going to be very fair with you. Whatever you charge, I’m charging.’”
Musk reacted to this by saying, “It seems fair.”
India’s New EV Policy and Tesla’s Expansion Plans
In March 2025, the Indian government introduced a revised EV policy, significantly lowering import taxes to 15%—but only under strict conditions. The tax reduction is available only if a carmaker invests $500 million and agrees to set up a manufacturing plant in India.
According to a Reuters report on Tuesday, Tesla has already chosen locations for two showrooms in New Delhi and Mumbai and has started hiring for 13 mid-level positions in the country. However, Tesla has no manufacturing facility in India yet.
Trump Warns of ‘Unfair’ Trade Practices
Trump reiterated that if Tesla builds a factory in India, it would put the U.S. at a disadvantage:
“Now, if he built the factory in India, that’s okay, but that’s unfair to us. It’s very unfair.”
Trump has long pushed for reciprocal tariffs on countries that impose duties on U.S. imports, a stance that has raised concerns about a potential global trade war.
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