Next-gen AI6 chip production heads to Texas
Tesla CEO Elon Musk has announced a $16.5 billion chip supply deal with Samsung Electronics. The contract will see Samsung manufacture Tesla’s next-generation AI6 chips at its new facility in Texas.
Samsung had initially revealed the deal without naming the customer, citing confidentiality. However, multiple sources confirmed Tesla is the client. Following Musk’s post on X, Samsung shares jumped over 4%.
Musk calls Texas fab ‘strategic’ for Tesla AI chips
In his statement, Musk said Samsung’s new Taylor, Texas fab will be dedicated to producing Tesla’s AI6 chips. He called the collaboration “strategic,” highlighting the fab’s proximity to his home and Tesla’s ability to assist in improving production efficiency.
“Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency,” Musk posted, adding that he would personally “walk the line” to speed up progress.
Samsung struggles with TSMC rivalry
This partnership comes at a crucial time for Samsung. The company has been losing clients to competitors like TSMC, which currently supplies chips to Apple, Nvidia, and Qualcomm. Analysts estimate Samsung’s foundry business lost more than 5 trillion won ($3.63 billion) in the first half of 2025.
The Tesla deal could help revive Samsung’s foundry segment, which manufactures logic chips designed by clients like Tesla.
Why this deal matters globally
While Samsung leads in memory chips, it has lagged behind in AI and logic chips. The Tesla contract may not involve cutting-edge 2nm tech, but it marks a step forward in Samsung’s U.S. expansion.
Industry watchers believe the agreement will boost U.S.-South Korea tech ties and may play a role in ongoing trade discussions. The fab’s Texas location also aligns with American efforts to localize semiconductor manufacturing.
A long-term commitment
The deal runs through 2033, offering a decade of collaboration. For Tesla, it means more control over its AI chip supply for vehicles and possibly robotaxis. For Samsung, it offers a financial and strategic lifeline in a competitive chip landscape.
As AI continues to reshape tech, this deal could reshape the global semiconductor power balance.
Source: Reuters
