Elon Musk’s Tesla to restart Dojo3 development after AI5 chip design breakthrough

Tesla is dragging Dojo3 out of the grave.Elon Musk says the company is restarting the project now that the AI5 chip design is finally “in good shape.”

Elon dropped the update in a late-night post on X that reads:-

That’s the first time since the abrupt shutdown last year that Elon has publicly committed to bringing Dojo back. Dojo was Tesla’s bet on building its own supercomputer to train the machine-learning systems behind Autopilot, Full Self-Driving, and the Optimus robot.

Musk pushes ahead with AI5 while hinting at chip convergence

Last week, Elon said AI5 was “almost done.” He also said AI6 was already in early development. That chip, unlike AI5, won’t be built in-house.

Tesla is leaning on Samsung Electronics for production. The two companies signed a $16.5 billion agreement last year to supply AI chips through 2033. The deal is a big win for Samsung’s chip foundry, which handles outsourced production.

A new facility in Texas will handle the manufacturing of the AI6 chip, giving Tesla another production hub outside Taiwan Semiconductor Manufacturing Co., its usual supplier.

During Tesla’s Q2 2025 earnings call, Elon said the company was now thinking about merging the Dojo3 chip with the AI6 design.

“Thinking about Dojo3 and the AI6 inference chip, it seems like intuitively, we want to try to find convergence there, where it’s basically the same chip,” he said on the July 23 call. That’s a turn from Tesla’s earlier approach, which focused on keeping everything in-house.

The change is also tied to doubts Elon voiced earlier in 2024. “We’re pursuing the dual path of Nvidia and Dojo,” he said in January. “I would think of Dojo as a long shot. It’s a long shot worth taking because the payoff is potentially very high. But it’s not something that is a high probability. It’s not like a sure thing at all.”

That uncertainty seemed to hang over the whole Dojo thing… until now.

Company hit by talent loss and political backlash last year

Dojo originally ran on a custom D1 chip built inside Tesla. The system ingested camera data from vehicles, processed it fast, and was meant to train models that run Tesla’s self-driving and robotics systems.

Back in 2023, analysts at Morgan Stanley said Dojo might eventually add $500 billion to Tesla’s market cap. That’s never happened. Instead, the company shelved the project in 2025 after losing several top engineers.

Milan Kovac, head of engineering for Optimus, and David Lau, Tesla’s vice president of software engineering, both quit in 2025. Omead Afshar, one of Elon’s closest aides, also left the company that June.

Meanwhile, Tesla was dealing with lower sales, growing competition, and political blowback tied to Elon’s public statements. The company hit pause on Dojo just as all of that was piling up.

Now that AI5 is stable again, the effort is back in motion. Tesla isn’t saying whether the D1 chip will stay or if everything will shift toward Samsung’s AI6 design, but the roadmap looks different now.

The company is also building new production lines in Texas, it’s got the Samsung deal locked in, and Elon is finally talking about Dojo again like it has a future.

Amidst it all, Elon is of course still stacking wealth at a speed no one’s ever seen. Two days ago, Forbes confirmed that Elon’s xAI Holdings raised $20 billion at a $250 billion valuation, pushing his net worth to $780 billion, making him the first person ever within striking distance of $800 billion.

His 49% stake in xAI alone is now worth $122 billion, thanks to a merger with X that added $62 billion to his net worth in just ten months.

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