Tesla has previously made a major $2 billion investment into Elon Musk’s A.I. company xAI. This move is part of Tesla’s broader strategy to integrate artificial intelligence into its product offerings, aligning with the company’s Master Plan Part IV. The investment is scheduled to close in Q1 2024.
xAI’s sole interest at the moment is creating sophisticated, customized digital AI products and services. Among its bigger projects has been the large language model called Grok. Their corporate goal is to build smarter humanoid robots around this tech. They’ve made it a part of their plan to power their future robots, including Tesla’s Optimus humanoid, with it. In its latest quarterly report, xAI disclosed a higher quarterly loss but remains optimistic about its future prospects as it continues to innovate in the AI sector.
As an extension to the funding process, xAI was able to raise $20 billion in a Series E funding round. This round caught the attention of strategic and financial investors, like Valor Equity Partners, Fidelity and the Qatar Investment Authority. Nvidia and Cisco, meanwhile, are emerging as aggressive strategic investors. This is indicative of the overall unwavering confidence that leading industry players across the board have in xAI’s potential.
Back in November 2023, Tesla shareholders were presented with a nonbinding measure. This measure was intended to authorize the board to invest in xAI. This far-reaching proposal received incredible widespread support, with nearly 1.06 billion votes in favor to only 916.3 million opposed. That’s a huge show of shareholder confidence behind Tesla’s AI plans and you can’t argue otherwise.
Elon Musk’s financial sweetener to xAI aside, the partnership between Tesla and xAI isn’t just about the money. So far, they have only signed a framework agreement. This unprecedented agreement details their joint acceleration of Tesla’s artificial intelligence development and deployment potential on a global scale.
“As set forth in Master Plan Part IV, Tesla is building products and services that bring AI into the physical world. Meanwhile, xAI is developing leading digital AI products and services, such as its large language model (Grok),” – Elon Musk
“Together, the investment and the related framework agreement are intended to enhance Tesla’s ability to develop and deploy AI products and services into the physical world at scale,” – Tesla spokesperson
This latest investment highlights Tesla’s dedication to developing and utilizing the most advanced AI technology within its own operations and products. As you know, xAI is at the forefront of creating advanced AI systems that can deeply penetrate your industries. Collectively, both companies are committed to developing technology’s future in impactful new ways.
