While details regarding the scale of investment and the official launch date remain under wraps, UPS's move signifies a potentially significant development on two fronts.
Firstly, for UPS, this could streamline their supply chain by establishing a regional manufacturing base for these tracking tags. Secondly, for India, this could be a major boost to their semiconductor industry, attracting further investment and technological expertise.
Notably, despite initial setbacks in offering $10 billion in incentives to the semiconductor industry, the Indian government continues to invest in semiconductor manufacturing.
Chief Digital and Technology Officer Bala Subramanian stated that they are working with potential partners to leverage the semiconductor investments made by the Indian government. UPS began expanding its use of RFID tags on packages about two years ago, significantly improving package tracking efficiency and reducing lost or misdirected packages. Subramanian mentioned that they plan to build these tags in India for global use, although specific details about the investment size and manufacturing timeline are yet to be disclosed.
While UPS currently lacks manufacturing capability in India, it opened its first technology center in Chennai, Tamil Nadu in August. This center complements its existing U.S. and European teams, allowing UPS to develop in-house technology. Subramanian emphasized that they will continue to grow in Chennai, further enhancing their technological capabilities.
In a conclusion, UPS's collaboration with Indian state governments aims to produce parcel-tracking tags locally, leveraging India's semiconductor investments and contributing to the country's chipmaking ambitions.
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