New partnership aims to power Tesla’s AI future
Tesla has signed a $16.5 billion chip supply agreement with Samsung Electronics to produce its next-generation AI6 chip. The chips will be manufactured at Samsung’s long-delayed Taylor, Texas facility, which until now had struggled to attract anchor clients. Tesla CEO Elon Musk confirmed the deal and emphasized the importance of the partnership in streamlining chip production.
While the announcement boosted Samsung shares by nearly 7% and Tesla stock by 4.2%, analysts caution that the deal will have minimal short-term impact on Tesla’s electric vehicle sales or its robotaxi development timeline. Production of the AI6 chips is likely several years away, possibly starting in 2027 or 2028, according to experts at SK Securities.
Samsung finds lifeline for Texas chip plant
Samsung’s Taylor factory has faced repeated delays and struggled to secure major customers. This Tesla order marks a turning point, potentially helping Samsung reduce losses from its foundry unit, which reportedly lost over $3.6 billion in the first half of the year. Samsung currently controls just 8% of the global foundry market, far behind leader TSMC’s 67% share.
The AI6 chip will eventually follow the AI5, expected to enter production by late 2026. For now, Samsung manufactures Tesla’s AI4 chips, which support the company’s Full Self-Driving assistant. TSMC will build the AI5 chips, starting in Taiwan before moving production to Arizona.
Strategic implications beyond EVs
Although the new chips will be central to Tesla’s self-driving vehicles and humanoid robot initiatives, Musk has hinted at broader AI uses. The AI6’s enhanced inference capabilities may eventually support applications beyond the automotive sector, possibly extending to general AI models and real-time decision-making technologies.
Musk also highlighted his personal commitment to accelerating production, noting that the Texas plant is located near his home and that Tesla will assist in improving factory efficiency. He suggested that actual chip output could exceed the $16.5 billion baseline deal by multiple times over the long term.
Trade backdrop raises questions
Though it remains unclear whether this deal plays into broader U.S.–South Korea trade negotiations, its timing is notable. Seoul has been actively seeking bilateral agreements to avert potential 25% tariffs on key exports. However, South Korean officials stated they were unaware of any direct link between the Tesla-Samsung deal and ongoing negotiations.
Despite the uncertainties, the agreement offers a boost to both companies’ long-term strategies. Tesla secures a local, U.S.-based chip source for future AI ambitions, while Samsung gains a high-profile client for a project that had been under pressure.
