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Elon Musk to Spend $10B on Nvidia AI Hardware

Daniel Kim Views  

Tesla CEO Elon Musk is likely to spend between $3 billion and $4 billion on Nvidia artificial intelligence hardware this year. This statement was made in response to a CNBC report claiming that Tesla plans to use the AI hardware for xAI, Musk’s startup. Musk refuted the report and claimed that the investment was reserved solely for Tesla.

On the 4th, Musk wrote a post on X, “Tesla anticipates to spend $10 billion on AI, half of which are internal costs.” He added, “Half will be used for Tesla Dojo and sensors installed in the vehicles.” He continued, “(Of the) costs, two-thirds will be used to purchase Nvidia hardware. My estimated expenditure of Tesla to purchase Nvidia hardware is between $3 billion and $4 billion this year.”

Musk’s post was a direct response to a report by CNBC. CNBC reported that Musk had purchased Nvidia AI hardware through Tesla to be utilized for xAI. Citing an internal Nvidia memo, CNBC reported, “Musk is prioritizing the 12,000 H100 GPUs intended for supply to Tesla for X. Instead, the 12,000 H100s that X was due to receive in January and June are redirected to Tesla.”

In April, Musk announced, “We will increase the numbers of H100 from 35,000 to 85,000 by the end of the year,” during Tesla’s press releases. There were speculations that Musk was prioritizing xAI over Tesla and that Tesla would ultimately fail to secure the AI hardware it aimed for, according to the CNBC report.

Musk admitted that he had allocated a partial amount of chipsets for xAI, but explained that this did not mean he was leaving Tesla behind. He said, “Tesla didn’t have enough space for AI hardware at the time. It would have been a waste if all the hardware were sitting in the warehouse.” He added, “Currently, the Texas Gigafactory expansion is in the final stages and we plan to accommodate 50,000 H100s for FSD learning there.”

Daniel Kim
content@viewusglobal.com

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