Leading EV Chip Supplier Lands Tesla Model 3 Contract (Update)

1 month ago by Steven Loveday 10

Tesla Model 3

Tesla Model 3

The world’s most successful EV chip supplier aims to dominate the electric vehicle market after striking a deal with Tesla to supply chips for the hugely popular Tesla Model 3.

Update: Infineon will now supply chips as a secondary source to Tesla

Although it looked like German chipmaker Infineon wasn’t going to land the coveted contract to supply chips for the Tesla Model 3, the story has change in the company’s favor. Initially, Franco-Italian chip supplier and Infineon rival, STMicroelectronics, won the Model 3 deal, but Infineon will now be used as a backup plan.

Tesla

Infineon already supplies chips for the Tesla Model S.

Infineon makes battery and motor chips for eight out of the 10 top-selling EVs globally. However, a primary part of the brand’s business is focused on Asia. Infineon CEO, Reinhard Ploss, shared:

“Our success is very much dependent on Asia.”

With the potential for a huge Tesla Model 3 contract, Infineon’s dependency on Asia may be about to change. Ploss is excited that the Model 3 could be a substantial boost to fuel the company’s U.S. market. He told reporters during a recent conference call that Infineon is eager to secure more deals in the American market (outside of ones that the US considers vital technologies anyway).

Aside from the Model 3, Ploss was unwilling to share information about specific models that Infineon supplies. However, we are aware that Infineon’s chips are currently used in the Tesla Model S. Kloss said:

“We do not comment on the individual models, but we will also will be present in Model 3.”

With pre-orders for the Tesla Model 3 quickly approaching a half-million, and orders streaming in, this is still a big win for Infineon. As more U.S. car companies move into the EV segment, perhaps they will look to Infineon as a viable choice.

Source: Reuters

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10 responses to "Leading EV Chip Supplier Lands Tesla Model 3 Contract (Update)"

  1. RPadTV says:

    “this is a huge contract for Infineon.”

    I wouldn’t say that. It’s a significant contract, for sure, but hardly huge. Infineon supplies chips for a number of broader consumer electronics and appliances. The EV market is tiny compared to the other spaces Infineon competes in.

    1. speculawyer says:

      Tesla has the EV with the highest demand ever (the Model 3) and currently has a market cap larger than GM or Ford.

      Yeah, the EV market is still pretty small. But if you don’t think this is a huge opportunity for growth, I don’t know what to tell you.

      1. RPadTV says:

        I never said that it wasn’t a huge opportunity. The article said that it was a huge contract. Relatively speaking, it’s not.

        1. Devin Serpa says:

          Yea, it’s not a huge contract like AMD contract for Apple 20 years ago…

  2. Euro point of view says:

    Surprisingly Tesla signs this contract after the so called launch of the M3

    1. Pushmi-Pullyu says:

      Neither this article nor the source claim the contract was signed after the TM3 went into production.

      There is no indication here of the date when the contract was signed. For all we know, it could have been months ago.

      1. speculawyer says:

        Yeah, I can’t imagine they are just signing a deal NOW.

        1. Tom says:

          You never know. Perhaps Tesla has some extremely skilled squirrels with tiny hands that are skilled with at soldering small components as a stop gap.

  3. (⌐■_■) Trollnonymous says:

    Hope they don’t go “Sole Source”.

  4. ffbj says:

    story has changed

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