Tesla is in discussions with US reminiscence chip maker Micron in addition to Mumbai-based CG Semi, part of Murugappa Group, to guage procurement choices because it appears to be like to diversify its world provide chain, stated individuals conscious of developments. This follows the Elon Musk-led electrical car (EV) maker’s strategic take care of Tata Electronics to amass semiconductor chips for its world operations, as reported by ET in April final 12 months.
“Tesla spoke to representatives from the three giant semiconductor services which have taken off in India — Micron, CG Semi and Tata Electronics,” stated a kind of cited. It “known as conferences a couple of month-and-a-half in the past… to get a way of what sort of chips are anticipated to be packaged, after they’ll be ramping up and the timelines for operations.”
Micron’s Gujarat facility is slated to allow meeting and check manufacturing, and tackle home and worldwide demand. CG Semi’s facility will take a look at outsourced semiconductor meeting and check (OSAT). This three way partnership between CG Energy, Renesas and Stars Microelectronics may have Renesas as an anchor buyer, however is predicted to additionally serve others globally.
On Saturday, Elon Musk posted on X that he was wanting ahead to visiting India this 12 months.Queries despatched to Tesla, Tata Electronics, CG Semi and Micron remained unanswered as of press time.
Tata AutoComp, Tata Consultancy Providers, Tata Applied sciences and Tata Electronics have all turn out to be world suppliers to Tesla and are bracing for a much bigger position if the EV producer expands to India, as reported by ET on March 21.
Tata Electronics is investing over ₹91,000 crore to arrange a semiconductor fab unit in Dholera, Gujarat, in addition to an OSAT facility for ₹27,000 crore in Morigaon, Assam.
Murugappa’s CG Semi is organising an OSAT facility in Sanand for ₹7,600 crore, the place Micron can be establishing an meeting, testing, marking, and packaging (ATMP) facility, for over ₹23,000 crore ($2.7 billion).
Consultants level to world companies trying to derisk their provide chains more and more betting on India-based semiconductor operations. “There are sturdy indications that Tesla has began partaking suppliers past China and Taiwan, with targets set as early as 2025. India is rising as a critical contender on this shift,” stated Ashwin Amberkar, an unbiased automotive analyst.
Tesla’s reliance on Chinese language fabs for mature-node chips has been central to operations at its Shanghai Gigafactory. Nevertheless, rising geopolitical dangers and rising prices are pushing Tesla to “rethink its sourcing technique,” he added.
In accordance with Amberkar, CG Semi is organising a broad-scope OSAT in Gujarat whereas Micron’s Sanand plant will give attention to automotive-grade dynamic random-access reminiscence required for pc processors.
He stated Tata’s deliberate fab and OSAT services may assist legacy-node chip necessities for automotive digital management models or specialised computer systems fitted into autos.
Danish Faruqui, chief govt of US-based semiconductor funding advisory agency Fab Economics, stated 28-65 nm nodes and legacy packaging architectures comprise a excessive double-digit share within the element combine required for EVs.
He estimates that Tesla product platforms and roadmaps are poised for double digit compound annual development fee in consumption of 28-65 nm nodes merchandise.
“Particularly, Battery Administration System parts’ efficiency and effectivity are pivotal to gamers like Tesla’s aggressive moat, because it influences battery life and effectivity,” stated Faruqui.
The imposition of larger than 80% import tariffs on semiconductor merchandise by China as retaliatory measures in the direction of varied US imposed tariffs can be anticipated to disrupt legacy semiconductor provide chains. This can push automotive gamers with a world footprint like Tesla to broadbase provide chains.
“New entrants in legacy semiconductor manufacturing and packaging like India are positioned effectively to learn from such reorganisation of the provision chain. India presents itself in its place for each legacy semiconductors fabrication and packaging, with Micron’s ATMP, CG Energy’s OSAT, Tata fab and OSAT all being legacy semiconductor packaging companies,” he added.
Chinese language EV large BYD has its personal semiconductor unit. “It turns into an important a part of Tesla’s complete EV plan to have an in-house semiconductor unit, have a gradual provide chain as effectively with a number of distributors not overly depending on one nation,” stated business veteran Arun Mampazhy.
Whereas unique gear producers need resilient, diversified provide chains—not only for geopolitical insulation, but additionally to mitigate operational disruptions and value volatility—India’s chip sector nonetheless faces scale and ecosystem maturity hurdles, regardless of sturdy authorities backing.
“Partnering with a world EV chief may very well be catalytic for India’s chip ambitions,” stated analyst Amberkar.
Nevertheless, the nation should reckon with China’s know-how and compete intensely on the worth entrance as effectively.
