Infineon teams up with India’s CDIL to build chips for light EVs, energy storage solutions

Germany’s Infineon Technologies wants a crack at India, and on Thursday it signed a deal to do just that. A new partnership with CDIL Semiconductors will see the pair working together to build chips for electric vehicles and renewable energy systems.

CDIL has been around for more than 60 years, and this deal underscores how the country has collectively been trying — including with billions of dollars in investments — to bring its legacy, low-end chip industry into the 21st century, both to develop and export chips to meet global demand and to serve an evolving domestic market.

India is the world’s most populous country with over 1.4 billion people. But that number speaks more to potential than current reality when it comes to things like EVs. Today, EVs account for just 7% to 8% of the transportation market, including two-, three-, and four-wheeled vehicles.

The country wants to boost that proportion to 30% while also growing other, more eco-friendly technologies — for example, taking non-fossil energy generation from 100GW today to 500GW by 2030.

The ecosystem just isn’t there yet for this, however, with not just low penetration of EVs but also a dearth of battery storage solutions that are cost-competitive with traditional alternatives to drive consumer adoption. Enter partnerships like the one between Infineon and CDIL.

This is Infineon’s first manufacturing partnership in India, though the company has had a subsidiary in the country.

“We believe that India is still in the more early stage of an exponential curve, but we do believe that this market will accelerate significantly in the next few years because a lot of trends start to overlap … you have the electrification and batterification of everything,” said Richard Kuncic, Infineon’s senior vice president and general manager for power systems, in an interview with TechCrunch.

Infineon said it will supply wafers to CDIL for packaging and assembling at its Mohali facility in Punjab. The final products target light EVs — for example, electric two- and three-wheelers — and renewable energy products like solar inverters and energy storage systems.

CDIL general manager Prithvideep Singh told TechCrunch that the partnership aims to produce MOSFETs (metal-oxide-semiconductor field-effect transistors), which function as electronic switches to control electricity flow in devices ranging from smartphones to electric cars. However, CDIL plans to expand production by using Infineon’s wafers to develop IGBTs (insulated-gate bipolar transistors) over time. These components regulate high-voltage electricity in EVs and renewable energy systems.

CDIL’s semiconductor packaging facility currently has an annual capacity of 600 million power semiconductor units. Both companies see this as sufficient for now, though Singh noted that CDIL could scale production based on future demand.

Instead of traditional silicon, the semiconductors produced in India will use materials such as silicon carbide and gallium nitride, which offer greater heat resistance and provide more power density in a small space. CDIL has been working specifically on silicon carbide for the last four years and has even exported the material to other countries, including China.

However, Singh told TechCrunch that the Infineon partnership is currently focused on serving domestic demand.

“The wafer is like an engine. It is one critical component. And then, of course, you have the rest of the car, so it’s a good mix of both,” he said.

Infineon said it has no immediate plans to establish a wafer manufacturing site in India, but it will be making more deals with local players to grow.

“We are not starting five things just for the sake of it … We are doing one after another,” Kuncic said when asked about potential collaborations with other local players.