- A report claims that AI chips that had been earmarked for Tesla were instead redirected to the social media site X.
- Tesla had committed to increasing the number of Nvidia X100 chips from 35,000 to 85,000.
- Elon Musk took to X to say that the order was redirected as Tesla ran out of space.
A report claims that Tesla CEO Elon Musk instructed Nvidia, one of the world’s leading chip manufacturers, to redirect its AI processors from the automaker to Musk’s other businesses, X and xAI.
Artificial intelligence chips are crucial for the development of Tesla’s Full Self-Driving software and robotics projects. In an industry constrained by a supply of AI chips, the move to redirect the order is said to have set back Tesla’s $500 million processor delivery by several months.
Read: Why Some Of Tesla’s Big Investors Are Bailing On The Brand
On a first-quarter earnings call in April, Musk told an audience of Tesla investors that the company would up the number of Nvidia H100 artificial intelligence chips from 35,000 to 85,000. He also said on X that Tesla would spend $10 billion this year “in combined training and inference AI.”
However, CNBC reports that emails indicate Musk asked Nvidia staff to redirect processors that had been reserved for Tesla toward his social media company, X. The report references emails written by Nvidia senior staff members that have purportedly been widely shared inside the company.
“Elon prioritizing X H100 GPU cluster deployment at X versus Tesla by redirecting 12K of shipped H100 GPUs originally slated for Tesla to X instead,” said an internal Nvidia memo from December, according to CNBC. “In exchange, original X orders of 12K H100 slated for Jan and June to be redirected to Tesla.”
Another memo, reportedly from April 2024, said that Musk’s $10 billion investment statement on X would conflict with bookings and 2025 forecasts.
Musk has replied to these claims, reasoning that Tesla simply ran out of physical space. Taking to X, he said that “Tesla had no place to send the Nvidia chips to turn them on, so they would have just sat in a warehouse.” He went on to say, “The south extension of Giga Texas is almost complete. This will house 50k H100s for FSD training.”
The report comes as Tesla investors have already expressed concerns over Musk’s other entities. Some investors aren’t happy with his tendency to become consumed by non-Tesla matters, while a recent spate of layoffs within the company has caused concern.
