NEW DELHI—Tesla's highly anticipated entry into the Indian market appears to be off to a sluggish start, with the company receiving just over 600 orders since its official launch in mid-July. This figure is roughly equivalent to the number of vehicles Tesla delivered globally every four hours during the first half of the year, according to a report by Bloomberg.

The underwhelming sales performance has cast a shadow over the company's ambitious global growth projections. Sources familiar with the matter told Bloomberg that the order volume falls short of Tesla's internal expectations.

High Prices and Stiff Competition Hinder Sales 

Tesla had initially aimed to utilize its full annual quota of 2,500 imports for India. However, initial plans are now more modest, with an expected shipment of just 350 to 500 vehicles from its Shanghai factory arriving in the country early this month. Deliveries will initially be limited to four major cities: Mumbai, Delhi, Pune, and Gurugram.

Analysts point to several factors behind the slow start. Despite a strong brand reputation and the initial perception of close ties between CEO Elon Musk and President Donald Trump, the current political climate and India's protectionist trade policies have proven to be significant hurdles. The most prominent challenge, however, is pricing.

According to automotive data firm JATO Dynamics, the base Model Y offered in India is priced at over 6 million rupees (approx. $68,000) due to high import tariffs. This is a staggering difference from the mainstream electric vehicle (EV) price point of around 2.2 million rupees, making the Model Y inaccessible for the majority of Indian consumers.

While EVs only account for about 5% of India's total car sales, competitors like China's BYD are gaining traction with more affordable models. BYD reportedly sold over 1,200 units of its Sealion 7 SUV, which starts at around 4.9 million rupees, in the first half of the year.

This setback in India adds to a challenging year for Tesla, which has seen two consecutive quarters of year-over-year declines in vehicle deliveries globally. The company did not immediately respond to a request for comment.

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