Musk: Tesla to Streamline AI Chip Design

Aug 11, 2025

According to Reuters, Tesla CEO Elon Musk said the company will refocus its artificial intelligence (AI) chip research and development efforts, focusing on developing inference chips for running AI models and making real-time decisions. Earlier, Bloomberg News, citing sources familiar with the matter, reported that Musk had disbanded Tesla's Dojo supercomputer team and that its leader, Peter Bannon, would also depart.


Musk; Image: X


Late on August 7th, Musk posted on the X platform, "It's unconscionable for Tesla to split resources and simultaneously scale two completely different AI chip designs. Tesla's AI5, AI6, and subsequent chips will excel at inference and at least quite well at training." He did not directly mention Dojo.

Musk has announced that the next-generation AI5 chip will be in production by the end of 2026, and last month he also announced a $16.5 billion deal for Tesla to source its AI6 chip from Samsung Electronics, but he has not yet provided a production timeline.


Musk said future AI inference chips, including the AI6, will be deployed in self-driving cars and Tesla's Optimus humanoid robot. He also noted that the powerful computing power could enable a wider range of AI applications.


Tesla has not yet responded to Reuters' request for comment on the report.

The Dojo supercomputer is designed around custom training chips to process large amounts of data and video from Tesla electric vehicles to train Tesla's self-driving software.


A team led by Morgan Stanley analyst Adam Jonas values the Dojo supercomputer at $500 billion in 2023, saying it opens up new markets for Tesla beyond car sales, similar to how Amazon's cloud division boosts profits.

Morgan Stanley noted on August 4 that "Dojo is a key accelerator at the intersection of hardware and software." However, Adam Jonas has not yet responded to questions about whether the latest development will affect Tesla's valuation.


Tech companies are increasingly designing custom chips to reduce latency, power consumption, and cost while consolidating around fewer architectures.

Tesla has been undergoing restructuring over the past year, with its stock price plummeting as electric vehicle sales have been hit by increased competition, particularly in Europe, and a consumer backlash against Musk's political views.


Tesla has seen several executive departures and thousands of job cuts, shifting its focus to AI-driven autonomous driving and robotics, while Musk is pursuing a consolidation strategy across his tech empire.

Bloomberg News previously reported that approximately 20 employees from the Dojo team recently left to join the newly formed DensityAI company, with the remainder being reassigned to other data center and computing projects within Tesla.

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