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Elon Musk -led Tesla has initiated a conversation with the American Memori Chip maker Micron and CG Semi in Mumbai, Murugappa Group’s a subsidiary, according to informed sources to expand their global supply network to detect supply options expanding the network. This development follows Tesla’s earlier strategic partnership with Tata Electronics for the purchase of semiconductor for operations around the world.
Elon Musk on Saturday announced his anticipated visit to India this year on X.
A source said, “Tesla spoke to representatives of three large semiconductor facilities in India – Micron, CG Semi and Tata Electronics,” a source said. This “a one-and-a-half months ago meetings somewhere … to understand what kind of chips are expected to be packed, when they will take a deadline for ramp up and operations.”
The Gujarat-based micron facility aims to provide assembly and testing capabilities, serving both domestic and international markets. The CG Semi unit will focus on OSAT operations. This cooperation between CG Power, Renesas and Stars Microelectronics will mainly serve renesas during diet for global customers.
Various TATA enterprises including Autochump, Consultancy Services, Technologies and Electronics have established themselves as global suppliers of Tesla, preparing extended roles and EV manufacturer should enter India.
Tata Electronics has invested Rs 91,000 crore for a semiconductor manufacturing unit in Dulera, Gujarat, with an OSAT facility of Rs 27,000 crore planned in Morigon, Assam.
Murugappa’s CG Semi has set up an OSAT facility in Sanand with an investment of Rs 7,600 crore with a micron assembly, testing, marking and packaging (ATMP) facility, priced more than Rs 23,000 crore ($ 2.7 billion).
Industry experts note that international companies are considering India for fast semiconductor operations as they diversify their supply chains. Independent motor vehicle analyst Ashwin Amberkar says, “There are strong indications that Tesla has started to confuse suppliers beyond China and Taiwan, setting targets in early 2025. India is emerging as a serious contender in this change.”
Tesla’s Shanghai Gigafactory currently depends on Chinese construction features for mature-nod chips. However, Amberkar noted that Tesla is being forced to rethink his sourcing strategy “by increasing geopolitical stress and cost increase.”
Amberkar explains that CG Semi is developing a comprehensive OSAT feature in Gujarat, while Micron’s Sanand unit will be a specialist in automotive-grade dynamic random-access memory for computer processors.
According to him, Tata’s proposed FAB and OSAT facilities can meet inheritance-nod chip requirements for automotive electronic control units or special vehicle computers.
In response to US tariffs, China’s move to implement more than 80% import duties on semiconductor products is likely to affect the traditional semiconductor supply network. The situation will encourage global motor vehicle manufacturers such as Tesla to diversify their supply sources.
Chinese electric vehicle manufacturer BYD operates its semiconductor division. Industry veteran Arun Mumpzi said, “It becomes an important part of Tesla’s entire EV scheme, which has an in-house semiconductor unit, not highly dependent on a country with a stable supply chain as well as several vendors.”
Original equipment manufacturers seek strong and diverse supply chains, not only for protection from geo -political issues, but also to reduce the ups and downs in operation disruption and value. Despite the strong government support, India’s semiconductor wants to face challenges about the scale and development of the ecosystem.
Analyst Amberkar said, “Partnership with a global EV leader can be a catalyst for India’s chip ambitions.”
Nevertheless, India should address China’s technical benefits while maintaining competitive pricing structures.
