Chip giants eye India: Infineon, Onsemi reportedly seek local partners for OSAT facilities

This partnership is seen as a potential precursor to Infineon expanding its OSAT footprint in the country.

German semiconductor giant Infineon and US-based chip supplier Onsemi are exploring partnerships with Indian firms to establish semiconductor assembly and testing (OSAT) facilities in the country, sources familiar with the matter told The Economic Times. These developments align with India's growing prominence as a hub for semiconductor manufacturing.

Infineon, one of the world's leading power semiconductor firms, is actively evaluating opportunities to create an OSAT presence in India, The Economic Times reported. The company recently signed an agreement with Mohali-based CDIL Semiconductors to supply bare semiconductor wafers, which CDIL will process and package into power chipsets. This partnership is seen as a potential precursor to Infineon expanding its OSAT footprint in the country.

“Their (Infineon’s) partnership with CDIL could also be viewed as a move towards setting up an OSAT in India,” one of the sources told The Economic Times. The person added that Infineon, known for its expertise in power semiconductors, is looking to expand into sectors such as automotive in the future.

In response to queries from The Economic Times, Infineon stated that while India is an important market and innovation hub for the company, there are currently no confirmed plans for manufacturing activities in the country. "On a regular basis, we evaluate potential partnerships across the globe. However, we can’t elaborate on potential future projects at this point," a company representative said.

Meanwhile, Onsemi is also seeking to expand its presence in India, with an OSAT facility as a key focus, another source told The Economic Times. The Arizona-based company, a major supplier of power semiconductors and sensors, sees a partnership with an Indian firm as an opportunity to provide technical expertise while the Indian partner funds the facility.

"Onsemi is very keen on an OSAT presence in India," the source said. "They see it as a way to leverage their brand name and have the Indian partner put in the money for the facility while they provide technical expertise. It becomes a win-win that way."

In response to The Economic Times' queries, an Onsemi representative stated, "At this time, we do not have any information to share."

These moves come amid India's push to strengthen its semiconductor ecosystem. The India Semiconductor Mission (ISM) has approved three OSAT facilities so far: Tata Group's Rs 27,120 crore unit in Assam, CG Power and Industrial Solutions’ Rs 7,584 crore facility, and Kaynes Technology India’s Rs 3,307 crore project in Gujarat’s Sanand, The Economic Times noted.

Infineon, which reported $15 billion in revenue for the 2024 fiscal year with a workforce of approximately 58,000 employees worldwide, is a major player in the global semiconductor landscape.

Onsemi, on the other hand, is navigating a challenging period. The American company, which recently announced plans to lay off around 2,400 employees as part of a restructuring exercise, reported $7 billion in revenue in 2024, down from $8.2 billion in 2023. Despite this, Onsemi recently placed a $6.9 billion bid to acquire chip developer Allegro MicroSystems to expand its revenue streams.