Tata-Tesla join hands: Semiconductor to be made in Dholera
Important announcement ahead of Elon Musk's visit to India, will make chips from Gujarat and send them to the world
Elon Musk-led Tesla signs strategic deal with Tata Electronics for semiconductor chips: Report Elon Musk-led Tesla has reportedly signed a strategic deal with Tata Electronics to procure semiconductor chips for its global operations. The move reflects Tesla's growing interest in India beyond domestic revenue generation.
ET exclusively reported that the deal, discreetly executed a few months ago, positions Tata Electronics as a trusted supplier to top-tier global clients looking to establish a critical segment of their semiconductor value chain in India.
Tesla, a leading US-based electric vehicle company, is looking to enter the world's fastest growing automotive market, India. Elon Musk is scheduled to meet Prime Minister Narendra Modi during his visit to India this month. Musk is expected to announce potential investments in India, including plans for camel production facilities. Tesla currently holds the title of the world's largest automotive company by market value.
Ashok Chandak, president of the India Electronics and Semiconductor Association, noted that Tesla's efforts to establish a local supplier ecosystem for electronics and subsystems show its commitment to diversifying its supply chain. However, he highlighted the need to improve the domestic semiconductor sourcing ecosystem to support industries like automotive, which require high value addition in their supply chains.
Tesla is expected to invest around Rs 2-3 billion in India to manufacture electric cars, reflecting the growing interest in the personal mobility market in the country. Enabled. However, this franchise has committed automakers to invest 500 million over three years to set up manufacturing facilities in India. Tesla is likely to prioritize premium electric models initially, while also considering local production of entry-level electric vehicles.
Tata Electronics has boosted its workforce by hiring 50-60 high-level expatriates in recent months, aiming to leverage their expertise in semiconductor technology, strategic planning and design to enhance its business operations.
Following the Covid-19 pandemic, Tesla has diversified its component sourcing outside of China for critical electronic, electrical and mechanical parts.
Tata Electronics has established semiconductor manufacturing facilities in Hosur (Tamil Nadu), Dholera (Gujarat) and Assam with plans for further expansion to create a well-integrated supply chain in India. The company has so far invested 14 billion in its business operations.
