Tesla Inc (NASDAQ:TSLA) has signed a $16.5 billion multiyear chip supply deal with Samsung Electronics, set to last through the end of 2033, CEO Elon Musk announced on Monday.
This agreement is focused on South Korea-based Samsung producing Tesla's next-generation AI6 chips at a new fabrication facility in Texas.
Musk highlighted that this facility will play a critical role in Tesla's advanced AI chips, which are used in autonomous vehicles, humanoid robots (Optimus), and AI data centers.
“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 wrote in a post on his social media platform X on Monday.
“The $16.5B number is just the bare minimum. Actual output is likely to be several times higher,” he wrote in another post.
The Tesla deal is expected to boost Samsung’s foundry business, as its Texas fabrication facility has had trouble attracting big customers.