Tesla signs $16.5B deal with Samsung to make AI chips

Tesla has entered a $16.5 billion agreement with Samsung to manufacture its next-generation AI6 chips, which are designed to power a wide range of Tesla technologies, from its Full Self-Driving (FSD) system to Optimus humanoid robots and AI training in data centers. Samsung’s new Texas fabrication plant will be dedicated to producing these AI6 chips, marking a significant expansion in Tesla’s chip manufacturing capabilities. Elon Musk also mentioned that Tesla is collaborating with TSMC for its AI5 chips, which have recently completed design and will initially be produced in TSMC’s Taiwan and Arizona facilities. Samsung already produces Tesla’s A14 chip, and this new deal represents a major boost for Samsung’s chip-making ambitions after previous struggles to secure large clients. Musk indicated that Tesla’s spending on Samsung chips could exceed the initial $16.5 billion deal, with actual production output expected to be several times higher. Additionally, Tesla will assist Samsung in optimizing manufacturing efficiency at the Texas fab,