Tesla CEO Elon Musk said the U.S. automaker had signed a $16.5 billion deal to source chips from Samsung Electronics, a move expected to bolster the South Korean tech giant’s loss-making contract manufacturing business.
Samsung’s shares jumped as much as 6.8% to their highest since September last year after news of the deal. Tesla shares were up 1.9% in U.S. premarket trading.
Musk said Samsung’s new chip factory in Taylor, Texas will make Tesla’s next-generation AI6 chip, potentially re-energizing the project that has faced long delays amid Samsung’s difficulties in retaining and attracting major clients.
“Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house,” Musk said in a post on X on Monday.
“The $16.5B number is just the bare minimum. Actual output is likely to be several times higher,” he said in another post.
