Tesla-Tata Electronics pact bolsters India’s semiconductor ambitions for EV production: Report

Tesla-Tata Electronics pact bolsters India's semiconductor ambitions for EV production: Report/Reuters

VoM News Desk | April 15, 2024 | 02:05 PM IST | Breaking News | Follow on Google News

Tesla-Tata Electronics pact bolsters India’s semiconductor ambitions for EV production: Report

Tesla-Tata Electronics pact bolsters India’s semiconductor ambitions for EV production: Report

Mint

Elon Musk’s Tesla has signed a strategic agreement with Tata Electronics to source semiconductor chips for its global operations, in a move aimed at expanding in the Indian market, The Economic Times reported on April 15.

The deal, executed discreetly a few months ago, positions Tata Electronics as a reliable supplier for top-tier international clients seeking to establish a crucial component of their semiconductor value chain within India, as per the report.

Tesla, the world’s largest automotive company by market value, is keen to expand its footprint in India, which is the fastest-growing major automotive market globally. The US-based EV maker’s founder and CEO, Elon Musk, is visiting India this month and is expected to meet with Prime Minister Narendra Modi. The Tesla CEO is expected to make major announcements  during his India visit, including a firm commitment to fund facilities that manufacture electronic vehicles, the report added.

Ashok Chandak, president of the India Electronics and Semiconductor Association (IESA), said Tesla’s decision to create a local supplier ecosystem for electronics and subsystems demonstrates its commitment to diversifying its supply chains, and not being overly dependent on a single market, as per the ET report.

“The major concern is local sourcing of semiconductors, and this needs improvement in the supply chain as value addition for the industrial and automotive segments is much higher,” Chandak was quoted as saying by ET.

Livemint could not independently verify the report.

EV’s Growth in India

Electric vehicle (EV) sales in India are expected to rise 66 per cent this year after nearly doubling in 2023, as the state subsidies help fuel demand, and supporting infrastructure comes up in the country, according to a recent report by research firm Counterpoint. This comes after India’s EV sales nearly doubled in 2023, driven by rising consumer interest, and concerns over climate change.

The projections for 2024 show EVs increasing its share in total passenger vehicle (PV) sales, driven by new entrants and government subsidies. By 2030, EVs are expected to account for nearly one-third of India’s PV market, signaling a robust long-term growth trajectory in the country’s automotive sector, the research firm said in its report published late last week.

(Except for the headline, this story has not been edited by VoM News staff and is published from syndicated feed)

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