Tesla and Samsung signed a contract to supply chips worth $16.5 billion — Musk

Tesla has signed a contract with Samsung Electronics to supply semiconductors worth $16.5 billion, Elon Musk confirmed on the social network X after Samsung published a regulatory notice without naming the customer. The agreement will be valid until December 31, 2033, CNBC reports.

According to Musk, Samsung’s new Texas plant will specialize in producing Tesla’s AI6 chip. Samsung currently makes the AI4, while the AI5 will be manufactured by TSMC, initially in Taiwan and later in Arizona. Musk also said that Tesla will be involved in optimizing the manufacturing process, and he will personally oversee production to accelerate progress. He added that the actual contract amount could be even higher.

Samsung has refused to name Tesla in official documents until the end of 2033, citing the other party's request to protect trade secrets. The company also warned investors about possible changes or termination of the contract. Samsung shares rose 5% on this background.

Samsung is the world's second-largest maker of custom chips after TSMC. In April, the company announced the start of mass production of 2nm chips. Qualcomm is also reported to be ordering such chips. Samsung currently lags behind SK Hynix and Micron in the production of HBM memory, which is actively used for AI. Hynix already supplies such chips to NVIDIA, while certification of Samsung's HBM chips is delayed.