Tesla Elon Musk, CEO of Tesla, recently made two major statements regarding the company’s moves to produce next-gen AI chips. Tesla is collaborating with the Taiwan Semiconductor Manufacturing Company (TSMC) to manufacture the new AI5 chips. The design development phase was recently completed, representing a major milestone in their partnership. The factory responsible for producing these chips is conveniently located near Musk’s residence, allowing him to oversee operations more closely.
In order to move faster, Musk announced that he would personally walk the production line to help accelerate progress. He emphasized the importance of this project, stating, “The strategic importance of this is hard to overstate.” This hands-on approach underscores what Tesla is trying to achieve. The firm has lofty goals to be the leader in technological innovation in the electric vehicle space and overall.
As part of its strategic initiatives, Tesla has signed a $16.5 billion deal with Samsung to supply these advanced chips. Musk noted that this couldn’t possibly be a one-time investment. This marks a firm step by Tesla towards developing a stable supply chain for its AI chip needs. Most recently, Samsung has signed on to work with Tesla. Collectively, they seek to make the best use of manufacturing capacity while increasing overall production capabilities.
Elon Musk’s broader empire encompasses various sectors, including autonomy, artificial intelligence, electrification, gig work platforms, and navigating regulatory scrutiny from Big Tech. His latest projects are still drawing interest and investment, a testament to his ability to shape the conversation and future development of new technologies.
Rebecca Bellan, now senior reporter at TechCrunch, on the Tesla and Musk’s long laundry list. She personally underscored the need for these advancements in her reporting. Bellan has further established himself as a leader in the innovation sector by personally investing in cryptocurrencies, including Ethereum, reflecting his personal proclivity toward new technologies.
Musk made these announcements during his appearance at the “Exploring the New Frontiers of Innovation” event. This event is the first of several TechCrunch events planned in San Francisco from October 27-29, 2025.
He mentioned that “actual output is likely to be several times higher,” indicating confidence in the production capabilities of the new AI5 chips. This rosy view isn’t far-fetched given Tesla’s consistent movement towards advanced technologies and an expanding automation presence.
