Elon Musk Shuffles $4 Billion Worth of Nvidia Chips – What's Cooking at Tesla?
In a recent revelation, Elon Musk has addressed rumors regarding the reallocation of Nvidia AI processors initially designated for Tesla to his social media company, X. The intrigue started with a report from CNBC accusing Musk of diverting these crucial Nvidia chips away from Tesla's ambitious AI projects.
Setting the Record Straight
Musk took to his own platform, X, to debunk the accusations. In a pointed message, he remarked, "Tesla had no place to send the Nvidia chips to turn them on, so they would have just sat in a warehouse." He elaborated further by saying, "The south extension of Giga Texas is almost complete. This will house 50,000 H100s for FSD training." His statement was clear; the Nvidia AI chips were not diverted maliciously but were awaiting the completion of Tesla's infrastructure to be put to effective use.
The Financial Picture
Continuing to explain Tesla's expenditure plans, Musk disclosed that Tesla has earmarked about $10 billion for AI-related expenditures in 2024. He clarified that half of this amount is for internal needs, primarily focusing on the Tesla-designed AI inference computer and sensors. He added, "For building the AI training superclusters, Nvidia hardware is about 2/3 of the cost. My current best guess for Nvidia purchases by Tesla are $3B to $4B this year." This elucidates that a significant portion of Tesla's budget is still firmly tethered to Nvidia's advanced hardware, underpinning their AI advancements.
A Questionable Report?
The CNBC report suggested Musk was overstating Tesla’s acquisition of Nvidia H100 AI chips during the first-quarter earnings call. The report also cited internal Nvidia emails and a December memo claiming 12,000 H100 GPUs had been redirected to X, which could potentially delay Tesla's progress in developing autonomous vehicles and robotics. This insinuation has been a focal point for critics arguing it could slow down Tesla's AI capabilities.
Musk's Counter Argument
To counter this narrative, Musk emphasized that Tesla's commitment to AI and robotics remains unwavering. He mentioned the near completion of the south extension of Giga Texas, which will house up to 50,000 H100 GPUs specifically for Full Self-Driving (FSD) training, reinforcing that the chips were always intended for Tesla's use. This planned infrastructure ensures Tesla remains rigorously on track to advance its autonomous technologies.
What's Next for Tesla?
Despite the skepticism portrayed by the CNBC report, Musk remains confident in Tesla's trajectory towards solving autonomy and continuing its lead in AI and robotics. In the April earnings call, Musk reiterated, "If somebody doesn’t believe Tesla’s going to solve autonomy, I think they should not be an investor in the company. We will, and we are." His unwavering assertion aims to instill confidence among stakeholders and highlight the importance of long-term vision in revolutionary endeavours.
The Bigger Picture
This chapter in the Tesla-Nvidia saga provides a tantalizing glimpse into how high-tech investments and corporate strategies are intricately interwoven with technological advancements and market expectations. As Tesla moves forward with its ambitious plans, the anticipation surrounding its next moves continues to heighten. One thing is clear: Musk’s emphasis on transparent communication seeks to ensure that both critics and advocates alike understand the broader vision of pushing the boundaries of AI and autonomous driving technologies.
Stay tuned as we continue to monitor how Musk’s bold claims and grand visions unfold in real-time, shaping the future of autonomous driving and beyond.