Local automobile giant Tata Motors has grabbed over 60% of the Indian market with its popular and economically priced electric cars. China’s BYD and MG Motor also rank among the top five EV sellers in the country. The automakers have rapidly grown in India by partnering with ride-hailing companies. 

“Indian automakers, especially Tata, already have a strong foothold in the EV market,” Jayapradeep Vasudevan, chief business officer of Indian electric-motorcycle maker Raptee.HV, told Rest of World. “Moreover, Tata’s diverse EV lineup and future expansion plans across different vehicle segments position them well to handle the competitive pressure from Tesla’s entry.”

While Tesla would have to build its presence from the ground up, Tata already has an established distribution network and customer service capabilities across urban and rural India, which give the company a significant advantage, Vasudevan said.

Musk has been hinting at an India entry since 2016, but that hasn’t materialized as Tesla failed to negotiate lower import taxes with the government. This might change soon. Last month, Musk met with Indian Prime Minister Narendra Modi in Washington, where they discussed space technology, mobility, and innovation. On March 11, India’s largest telecom companies, Reliance Jio and Bharti Airtel, announced partnerships with Musk’s satellite company Starlink, which has so far struggled to get a license to operate in the country. Tesla did not reply to a request for comment for this story.

Chinese brands’ success in emerging markets is largely due to their pricing strategy and the variety of models they offer. Tesla is yet to match up to that, John Jörn Stech, an international automotive expert and principal consultant at New York-based Shiftgate Consulting, told Rest of World.

“Chinese rivals are rolling out new models continuously and making updates to their products,” Stech said. “By comparison, Tesla products look rather staid and stale to Chinese and Asian consumers, who have a penchant for new things.”

Tesla is available in several Southeast Asian markets but lags behind Chinese players in most. For instance, in Thailand, the region’s largest EV market, the top five EV brands in 2024 were all Chinese, with BYD leading the pack by a wide margin. Tesla came in sixth with just 4,121 cars sold in 2024, compared to more than 27,000 from BYD.

Experts’ takes on Tesla in emerging economies

South America

“Tesla doesn’t offer price points and positioning like Chinese brands. It can’t do that unless it has another Tesla Model 3 moment where a single model takes over the world, which is harder now as the Chinese have elevated themselves.” — Lei Xing, independent auto analyst.

Southeast Asia

“Chinese brands have expanded their production to the region. Tesla has come a long way in going downmarket, but cutting EV costs is challenging. Only BYD has figured out how to make affordable EVs that appeal to global customers.” — Martin Schröder, associate professor, College of Policy Science, Ritsumeikan University.

India

“Local manufacturers like Tata Motors have invested in infrastructure and gained valuable consumer insights, giving them an advantage. As Tesla establishes itself, its future moves — like starting local production or launching a budget-friendly model — will determine how deeply it can penetrate.” — Vivek Kumar, project manager, automotive, at U.K.-based data analysis firm GlobalData.

China

“Five years ago, Tesla was the ‘catfish in the pool of sardines.’ Now it has become one of the sardines as the Huaweis and Xiaomis have become the catfishes. What can it do to become a catfish again? Not much given the much more competitive landscape.” — Lei Xing, independent auto analyst.

There is limited EV sales data available in other Southeast Asian countries, but Tesla ranks second in Malaysia and Singapore in terms of EV sales, and third in Cambodia, according to Martin Schröder, associate professor at the College of Policy Science at Ritsumeikan University.

“Tesla has been under pressure in Asia as competition from Chinese rivals has picked up dramatically over the past two years,” Stech said. “Given the nearly 50% drop in deliveries in China, plummeting sales in Europe, and a likely drop in sales in the U.S., it is unlikely Tesla will look for expansion markets. They have to fix the markets where they already made significant investments.”

In Saudi Arabia, Tesla is planning to open its first “pop-up stores” and at least one showroom soon. Reports in South African media in January said Tesla is close to setting up an office in the country.

But this might be too little, too late. Saudi Arabia, for instance, is backing other EV companies, which might give them an edge.

Until 2019, Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, held more than 8.2 million shares in Tesla. It sold most of the shares in 2019, and has since backed American EV maker Lucid Motors as well as Ceer, an automobile manufacturer formed under a joint venture between the sovereign fund and China’s Foxconn. Last year, Lucid officially opened the first car-manufacturing facility in Saudi Arabia.

One market where Tesla has found success is the United Arab Emirates, where the company has set up supercharger networks across major cities. The country has embraced the luxury positioning of Tesla’s cars, and the company, along with other EV players, has benefited from government incentives like free public charging, preferential parking, and exemptions on registration fees.