Musk Says Tesla AI5 Chip Almost Ready as Company Eyes AI Chip Dominance

TLDR

• Tesla CEO Elon Musk announced the AI5 chip design is nearly complete and AI6 chip development has started
• Tesla targets a 9-month design cycle for future AI chips including AI7, AI8, and AI9
• AI5 chips will be manufactured by Taiwan Semiconductor Manufacturing Company with high-volume production expected in 2027
• The chips will replace current AI4 chips in Tesla vehicles
• Tesla signed a $16.5 billion deal with Samsung Electronics in July to manufacture A16 chips in the United States

Tesla CEO Elon Musk revealed on Saturday that the electric vehicle maker has nearly finished designing its AI5 self-driving computer chip. The announcement came through a post on X, where Musk also disclosed that the AI6 chip has entered early development stages.

The company plans to establish a 9-month design cycle for its next-generation chips. Musk stated there will be AI7, AI8, AI9, and more chips to follow this timeline.

Taiwan Semiconductor Manufacturing Company will manufacture the AI5 chips. Musk previously stated in November that high-volume production would begin in 2027.

The new AI5 chips will replace the current AI4 chips used in Tesla vehicles. This upgrade represents the company’s continued effort to develop custom silicon for its autonomous driving systems.

In July, Tesla entered a $16.5 billion agreement with Samsung Electronics to produce A16 chips. The manufacturing will take place at Samsung’s facility in Texas.

The AI6 chips are expected to deliver roughly double the performance of AI5 chips. Production volume for AI6 is projected to be large by mid-2028.

Manufacturing and Applications

TSMC’s factory in Arizona will also participate in chip production. Samsung’s Texas plant will handle additional manufacturing capacity.

Musk projects these chips will become the highest-volume AI chips worldwide. He made a recruitment pitch on X, inviting people to join Tesla’s chip development efforts.

The chips will serve multiple purposes beyond vehicles. They will be used in Neuralink devices and Optimus robots.

Musk indicated a small number of AI5 units may be produced in 2026. Full-scale high-volume production remains scheduled for 2027.

Strategic Direction

The chip development program aims to reduce Tesla’s dependence on Nvidia. Nvidia currently leads the AI chip market.

Tesla continues to push forward with its custom chip roadmap. The company maintains its focus on in-house silicon development for AI applications.

The 9-month design cycle target applies to future chip generations. This timeline would allow Tesla to iterate rapidly on chip improvements.

Production facilities in both Texas and Arizona will support the manufacturing needs. The dual-location strategy provides geographic diversity for chip production.

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