Tesla has entered into a $16.5 billion partnership with Samsung to produce advanced AI chips.
The move according to the firm is to shape the future of artificial intelligence, AI, and electric vehicles.
This move was confirmed by Tesla CEO, Elon Musk, in a post on X (formerly Twitter), shortly after Samsung disclosed the agreement in a regulatory filing.
Musk noted that the new “AI6 chips” would be produced at Samsung’s state-of-the-art semiconductor facility in Taylor, Texas, US.
According to him, “The strategic importance of this is hard to overstate. These AI6 chips will power our Full Self-Driving software and broader AI capabilities, including robotics and neural networks.”
The chips are expected to serve as the foundation for Tesla’s next generation of self-driving software and potentially fuel other AI-related innovations within the Musk-led tech ecosystem.
Reacting on the deal, a senior analyst at Forrest, Alvin Nguyen, said the alliance is a “win-win” for both companies.
Nguyen said: “For Tesla, this deal means they now have a local and reliable partner to manufacture next-gen chips critical for Full Self-Driving and other AI-driven features.
“For Samsung, it finally brings a high-profile customer to its Texas plant, which had previously struggled to gain traction.”
Nguyen added, “This partnership is not just about money, it’s about innovation and the race to dominate AI technology in the EV sector.”
The analysts continued that the deal may mark a turning point in the global tech supply chain, particularly for the US, where semiconductor sovereignty has become a strategic priority.
