The world is striving with the semiconductor shortage, affecting supplies of everything from cars to WFH devices like laptops, mobiles, etc. However, the automotive industry is the biggest victim of the issue of the chip so far, with many brands busted to decrease their production in recent times. To address the matter, Tata Group is planning to set up a semiconductor assembly and test unit (OSAT) in India with an investment of up to US$ 300 million.
The group is reportedly in talks with three state governments – Tamil Nadu, Karnataka, and Telangana, and scouting for land to set up the new factory. The final venue is likely to be finalized by the next month. It is expected to grant employment to around 4,000 workers.
Reason for semiconductor's shortage
As discussed many times earlier, the COVID-19 pandemic promoted tremendous demands for electronic devices thanks to the changing working environment and need for faster internet connectivity. And the temporary closure of factories and other restrictions related to travel and transport drove irregularities in the global supply chain. And then, the enormous requirements from non-automotive sectors created a huge order backlog for the chips, thus, emerging the demand and supply gap. So, the chipmakers dedicated their resources to complete the orders placed first, and the automotive sector wasn't on their priority list.
