TLDR
- Elon Musk diverted 12,000 H100 AI chips originally intended for Tesla to his social media company X and AI startup xAI, according to an email from an Nvidia employee.
- Musk’s decision will likely delay Tesla’s receipt of its $500 million-plus GPUs by months, delaying the development of the automaker’s AI infrastructure.
- Musk responded to this claim by saying that Tesla had nowhere to put the chips, which would have been sitting idle in a warehouse, and that Tesla’s southern expansion of its Texas Gigafactory will soon house 50,000 H100s for training in self-driving technology.
- The report has exacerbated tensions between Musk and some Tesla investors who believe he has a conflict of interest and is not meeting his obligations to the automaker.
- Musk’s companies, including xAI and Neuralink, compete with giants such as OpenAI and Google in the AI and brain-computer interfaces sectors.
According to recent reports, Tesla CEO Elon Musk has instructed Nvidia to prioritize shipping AI chips to his social media company X and AI startup xAI over the electric car maker.
According to an email from an Nvidia employee obtained by CNBC, Musk switched 12,000 H100 GPUs originally intended for Tesla to the
The decision has raised concerns among some Tesla shareholders, who question whether Musk can meet his obligations to the company while also running several other ventures that require significant attention and resources.
Critics argue that Musk is only a part-time CEO of Tesla, the company responsible for most of his wealth, managing SpaceX, Neuralink, The Boring Company and the recently acquired X (formerly Twitter).
Musk has encouraged Tesla investors to focus on future products such as AI software for self-driving cars, dedicated robotaxi, and driverless transportation networks.
He said Tesla will increase the number of active H100s from 35,000 to 85,000 by the end of this year, emphasizing the importance of Nvidia GPUs in achieving that goal. But the Nvidia email suggests Musk may have been overstating Tesla’s procurement plans to shareholders.
In response to the report, Musk reached out to X to clarify the situation. He said Tesla doesn’t have a place to turn on the Nvidia chips and they would have been sitting idle in a warehouse.
Musk added that Tesla’s southern expansion of its Texas Gigafactory is nearly complete and will accommodate 50,000 H100s for self-driving technology training.
Laura “Lie” Kolodny
— Elon Musk (@elonmusk) June 4, 2024
Despite Musk’s explanation, the report exacerbated tensions between the billionaire entrepreneur and some Tesla investors.
The company’s stock price fell nearly 30% this year as sales declined due to the aging electric vehicle lineup and intensifying competition.
Some shareholders have expressed concerns about Musk’s ability to effectively manage his diverse company while keeping Tesla a leader in the electric vehicle and AI markets.
Musk’s other ventures, most notably xAI and Neuralink, are competing in the rapidly evolving sectors of AI and brain-computer interfaces.
xAI recently introduced the Grok chatbot as a “non-wake” alternative to OpenAI’s ChatGPT, and Neuralink received FDA approval to begin human trials of its brain-computer interface technology.