Tesla In Talks With Micron, CG Semi And Tata Electronics To Strengthen Supply Chain

Tech billionaire Elon Musk-owned Tesla has initiated discussions with US memory chipmaker Micron, India's CG Semi, and Tata Electronics as part of a strategy to diversify and strengthen its global semiconductor supply chain, says a report by Economic Times (ET).

Micron, CG Semi Approached For Potential Chip Sourcing

Tesla is conducting discussions with American memory chipmaker Micron and Mumbai-based CG Semi, a Murugappa Group company, as it investigates new semiconductor sourcing options, the ET report added. 

These conversations are part of the electric vehicle manufacturer's strategic initiative to diversify its global semiconductor supply network.

This development follows Tesla's previously announced 2023 agreement with Tata Electronics for chip procurement supporting its international operations.

Focus On Production Capabilities And Timelines

The report added that Tesla has initiated dialogue with several key semiconductor companies establishing facilities in India, including Micron, CG Semi, and Tata Electronics. These discussions have reportedly centered on chip packaging capabilities, production timelines, and facility scaling plans.

Micron's Gujarat facility is designed to serve both domestic Indian markets and international export demands through assembly and test manufacturing operations. CG Semi, operating as a joint venture between CG Power, Renesas Electronics, and Stars Microelectronics, is developing an outsourced semiconductor assembly and test (OSAT) facility that will initially supply Renesas before expanding to serve additional global clients.

These engagements suggest Tesla's increasing interest in establishing India as a strategic partner within its supply chain ecosystem, particularly as geopolitical developments prompt many companies to reduce dependence on Chinese manufacturing and sourcing.

Musk Confirms India Visit

On Saturday, Musk confirmed his intention to visit India this year, following a recent conversation with Prime Minister Narendra Modi. This communication continues their ongoing dialogue, which has included previous in-person meetings, such as their encounter in Washington DC earlier this year.

While Tesla had previously expressed interest in establishing manufacturing operations in India, more recent reports suggest that local production remains a longer-term consideration.