After losing Foxconn, India ushered in two nobles! BYD, Tesla or build factories

In the past two years, the trend of manufacturing industry shifting to South Asia and Southeast Asia has become more and more obvious. But as the country with the richest human resources and the largest market in the subcontinent, India has always been in an awkward situation and faced many controversies. Whether to go to India to develop has become a very entangled issue in the minds of foreign-funded enterprises.

Recently, many blockbuster companies have emerged in the team that withdrew from India and entered India, which has also pushed India to the center of public opinion again.

First, on July 10, some media reported that Foxconn would withdraw from the semiconductor joint venture project with Indian metal oil group Vedanta, which invested up to $19.5 billion. Subsequently, Foxconn also issued an official statement confirming the news, but did not disclose the reason for the withdrawal. Less than a year after the signing of the cooperation agreement, the sudden breakup caught investors off guard.

But India does not have to be sad, because new donors are coming one after another. On July 13, it was reported that Tesla has begun discussions with the Indian government to build a factory, and is expected to build a new automobile production plant in the area, with an annual production capacity of 500,000 vehicles. The next day, Reuters broke the news that BYD planned to invest $1 billion to cooperate with local Indian companies to produce electric vehicles and batteries.

However, the two companies have not yet responded to this, and it will take time to test whether the construction of a factory in India can be done.

Some people want to escape, others rush in, and India seems to have become a "besieged city" of the new era. The reasons why Foxconn withdrew from the joint venture semiconductor factory plan and the considerations behind BYD and Tesla's bet on India, outsiders may not be able to guess. But what is certain is that the Indian market must have its own charms and shortcomings.

Negotiations with the local government are the first test that Tesla and BYD need to face. While Musk thinks the Indian government will give the green light on tariff exemptions, the latter doesn't seem to have that in mind. According to foreign media reports, the Indian tax commissioner has previously said that "no tariff relief for Tesla has been considered."

BYD took a fancy to India earlier than Tesla, but it also encountered a lot of trouble in dealing with the local government. Not long ago, BYD and the Indian government also caused a lot of disputes over the payment of 1,000 K9 bus orders, which also added a trace of uncertainty to the next cooperation between the two sides.

India's advantages are very prominent: low labor costs and a huge domestic market, new energy penetration rate is at a low level and lack of local enterprises with strength, Tesla, BYD if they can enter smoothly will inevitably set off a wave of shock in the local area. Giants such as Apple, Google, and Microsoft have increased their investment in India for the same reason.

However, policy uncertainty and conflicts in culture and consumption habits are also problems that Tesla cannot avoid. Whether these problems can be solved also determines their success or failure in the Indian market.