Tesla looks to American, Indian chipmakers to diversify supply chain

After Tata Electronics, Tesla has held discussions with Mumbai-headquartered CG Semi for potential chip sourcing

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Tesla is in discussions with US-based memory chipmaker Micron, as well as Mumbai-headquartered CG Semi, a Murugappa Group company, to explore potential chip sourcing options, according to a report by The Economic Times. The talks are part of the electric vehicle (EV) giant’s broader strategy to diversify its global semiconductor supply chain.

 

These interactions follow its earlier agreement with Tata Electronics to procure chips for its international operations, announced in 2023.

 

Tesla in talks with Micron, CG Semi, and Tata Electronics

 

According to the report, Tesla has engaged with key players operating semiconductor facilities in India, including the newly established units by Micron, CG Semi, and Tata Electronics. The conversations reportedly focused on chip packaging capabilities, production timelines, and expected scale-up schedules.

 

Micron’s facility in Gujarat is positioned to serve both domestic and export markets through assembly and test manufacturing. Meanwhile, CG Semi, a joint venture between CG Power, Renesas Electronics, and Stars Microelectronics, is setting up an outsourced semiconductor assembly and test (OSAT) plant that will initially cater to Renesas but is expected to serve other global clients as well.

 

These talks signal Tesla’s growing interest in India as a strategic partner in its supply chain ecosystem, especially at a time when geopolitical shifts are prompting companies to de-risk operations away from China.

 

Elon Musk plans visit to India this year

 

On Saturday, Tesla CEO Elon Musk confirmed plans to visit India this year, shortly after a call with Prime Minister Narendra Modi. Their interaction follows previous in-person meetings, including one in Washington DC earlier this year. Tesla had earlier shown interest in opening up a manufacturing unit in India, however, more recent reports indicate that local manufacturing may remain a distant reality. 

 

According to a report by Bloomberg, Tesla will begin selling EVs in India and is reportedly preparing to ship several thousand vehicles to a port near Mumbai in the coming months. Sales are expected to begin in major metros such as Delhi, Mumbai, and Bengaluru by the third quarter of 2025.