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3d ago

Tesla and Samsung Seal $16.5 Billion AI Chip Deal for Texas Fab

Tesla will actively optimize chip production at the Taylor, Texas plant, marking a step forward in the U.S. push to reshore advanced semiconductor manufacturing.

tesla samsung | Image: Reuters
Elon Musk confirms $16.5 billion chip deal with Samsung for Tesla’s next-gen AI6 hardware
Image
A view of a Samsung Electronics Vietnam factory in Bac Ninh province, Vietnam, April 3, 2025. Vietnam, with a tariff rate of 46 per cent imposed by U.S. President Donald Trump, is one of six countries in the nine Southeast Asian region slapped with much bigger-than-expected by the U.S. REUTERS/Stringer/File Photo

Overview

  • Under a contract running until December 2033, Samsung’s Taylor, Texas plant will exclusively manufacture Tesla’s next-generation AI6 chips under a $16.5 billion supply agreement.
  • Tesla CEO Elon Musk said the automaker will work directly on the production line to maximize yields and accelerate the plant’s output.
  • The deal leverages U.S. CHIPS Act subsidies and aims to restart operations at the long-delayed Texas fab with volume production slated for late 2026.
  • Samsung’s foundry division, which posted over 5 trillion won in first-half losses, expects the partnership to help narrow its deficits and enhance its competitiveness.
  • The agreement marks Tesla’s return to Samsung for its AI roadmap after AI4 and AI5 production with TSMC, signaling evolving supply-chain strategies.