Steep tariffs on foreign-built cars means the Model Y costs 70 percent more than a similar example in the US
July 16, 2025 at 07:44
- Tesla has finally hit the Indian market, launching with the facelifted Model Y.
- But the base Y carries a hefty Rs 61.07 lakh ($71k) price due to import tariffs.
- A Long Range Model Y costs the equivalent of $80.5k, but is $46.6k in the US.
Tesla’s plans to build a factory in India came to nothing, but the brand is coming to the country anyway. It launched there this week with plans for just two showrooms initially – one in Dehli, one in Mumbai – and some prices that look outrageously expensive to Western eyes.
The Indian version of Tesla’ website lists two models of the only EV it will begin delivering this fall, the Model Y. The entry-level version is a standard range, single-motor, rear-wheel drive Y that offers zero to 62 mph (100 kmh) in 5.9 seconds and a 311-mile (500 km) WLTP range.
It’s yours for a scary Rs 61.07 ($71,000). You can’t buy an equivalent Y in the US, but you can in Germany for €45,970. That works out at $53,700 based on current exchange rates.
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If Indian drivers want the Long Range RWD Model Y (5.6 to 62 mph, 387 miles / 622 km), that’ll set them back Rs 69.15 ($80,500). In Germany the Long Range costs €50,970 on the road, or $59,500. Tesla’s US lineup starts with the Long Range, and it’s priced to make Indian’s cry: just $46,630 including destination.
The reason for the steep prices is partly due to logistics. American buyers get American-built Model Ys and European versions are built in Germany. But there’s another reason and it’s heavily tied to CEO Elon Musk’s desire to build a factory in India.
Any car sold in the country that is wholly built outside its borders is subject to huge tariffs. We’re talking up to 110 percent, according to Bloomberg, the sort of tariffs that make Trump’s levies look like pocket change.
So it’s not only the Tesla Model Y that looks expensive. So do pretty much all foreign cars compared with what they cost in Europe or the US. Take the BMW M4 Competition xDrive: it costs $90,600 in the US, a surprisingly chunky $126,400 (€108,200) in Germany and a whopping $181,700 (Rs 1,56.00) in India.
Some BMWs are built locally, including the X1 , X3, X5 and M340i, and the prices of those cars are closer to European levels.
Fancy a 911? A 2025 911 Carrera is no bargain at $132,300 in the US or $159,200 (€136,300) in its home country, the big gulf in those dollar amount largely being attributable to the weak dollar. The two currencies were almost trading at 1:1 at the start of the year but now a dollar only buys you €0.86. Both numbers, however, look good value next to the staggering $246,000 (Rs 2,11.26) price tag attached to the same Carrera bought through an Indian Porsche dealer.
