Elon Musk on Tuesday said that the merger of his AI startup and Tesla is “not out of the question”. Musk, in an interview with CNBC, was asked if he would be open to merging xAI into Tesla with the aim to have more control over the EV company, to which the tech-billionaire responded, saying, “Well, I guess anything is possible”.
Musk did say that there are no plans to do so as of now but he didn’t rule out the possibility either. “Obviously it would require Tesla shareholder support,” Musk said.
Elon Musk started xAI in 2023 as a new artificial intelligence company. In March, xAI bought X (formerly Twitter) through an all-stock deal. This deal valued xAI at $80 billion and X at $33 billion. As part of this, the company’s AI chatbot Grok was added to X and trained partly using data from the platform.
Tesla, xAI to keep buying chips from Nvidia and AMD: Musk
In the interview, Musk further added that Tesla and xAI will keep buying AI chips from Nvidia and AMD. He told CNBC’s Faber that xAI has already installed 200,000 GPUs at its Colossus data center in Memphis and plans to build a much larger site nearby with 1 million GPUs. However, he didn’t give any details about specific chip orders.
A report by Business Insider said that as per the documents seen by them, xAI is spending at least $400 million to build a supercomputer in Memphis. But there could be problems since the city’s power grid might not be strong enough to handle such a large project.
After Musk’s appearance on CNBC, Tesla’s stock went up by 0.5% by the market close. However, it dropped slightly in after-hours trading.
While Tesla’s stock has been rising in May after Musk said he was moving away from DOGE, it is still down about 10% compared to January 2. This drop is due to weak sales in the first quarter and growing doubts about Musk’s focus.
