Tesla Eyes US and Indian Chip Suppliers for Supply Chain Diversification

In a move to strengthen and diversify its global semiconductor supply chain, Tesla is currently in discussions with leading memory chipmakers, including US-based Micron and Mumbai-headquartered CG Semi, a Murugappa Group company. These talks align with Tesla’s broader strategy of mitigating supply chain risks amidst shifting geopolitical dynamics.

Tesla Engages with Micron, CG Semi, and Tata Electronics

As per news reports, Tesla has initiated discussions with prominent players in the semiconductor sector who have established facilities in India. This includes Micron, CG Semi, and Tata Group-backed Tata Electronics. The discussions have centred around chip packaging capabilities, production timelines, and expansion schedules.

Micron’s newly established facility in Gujarat is designed to cater to both domestic and international markets through assembly and testing operations. Simultaneously, CG Semi, a joint venture between CG Power, Renesas Electronics, and Stars Microelectronics, is setting up an outsourced semiconductor assembly and test (OSAT) plant. While the initial focus is to serve Renesas, the facility is expected to eventually supply other global clients as well.

Read More: Tesla Secures First India Showroom in Mumbai’s BKC

Tesla’s Strategic Shift Towards India

These developments follow Tesla’s earlier agreement with Tata Electronics in 2023 to source chips for its international operations. Tesla’s growing interest in Indian partnerships highlights the country’s emerging importance in global semiconductor manufacturing.

The move also reflects a broader industry trend where companies are looking to de-risk their operations from an overdependence on China. Tesla’s strategic engagements with Indian firms signify an important step in expanding its supply chain resilience and tapping into new manufacturing ecosystems.

Conclusion

Tesla’s ongoing discussions with Micron, CG Semi, and Tata Electronics underline its commitment to building a robust and diversified semiconductor supply chain. At a time of global supply chain reconfigurations, India’s growing semiconductor capabilities offer Tesla a promising avenue for sourcing critical components. CEO Elon Musk’s planned visit to India later this year further emphasises the significance of these developments.

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