Elon Musk-led Tesla has reportedly inked a strategic deal with Tata Group company Tata Electronics for semiconductors. This follows reports of Tesla discussing for an EV manufacturing facility in India.

Tesla inks deal with Tata Electronics. (Photo credit: Reuters/ Tata Group)

New Delhi: Elon Musk-led Tesla has reportedly inked a strategic deal with Tata Group company Tata Electronics for semiconductors. This comes ahead of Musk’s upcoming visit to India during which he is expected to meet Prime Minister Narendra Modi and is likely to announce plans for investment in India and setting up a factory in the country.

India’s semiconductor industry is expected to be valued at $100 billion by 2030, according to the IESA. By 2026-27, India’s electronics market, which uses chips extensively, is likely to be valued at $300 billion.

Tata Electronics has reportedly boosted its staff by adding 50-60 senior foreign executives as part of plans to augment its semiconductor operations and position itself as a reliable supplier of chips to domestic and global brands.

Tesla, currently the world’s largest automaker, is likely to invest nearly $2-3 billion in India to cater to a rising demand for EVs in the country, the ET reported, citing people familiar with the matter.

Tesla’s EV plan for India

The Musk-led EV maker is expected to focus on premium model sales while gradually expanding to local production of entry-level EVs, according to the report. The Musk-led EV maker has reportedly started the production of vehicles meant for sale in India at its facility in Gruenheide, near Berlin in Germany. The factory has an annual output capacity of 50,000 units. These EVs will be right-hand driven in conformity with Indian driving regulations.

Musk to meet PM Modi

Musk is set to meet PM Modi next week during April 21-22, the former confirmed in a social media post. During his visit, Musk is also expected to discuss plans for Starlink satellite web services and urge for clearances to expedite its rollout. Musk will compete with Bharti Airtel and Reliance Jio in this space to receive all the required regulatory clearances.