Elon Musk intends to spend $5 billion from Tesla funds to invest in AI startup xAI

The head of Tesla is able to present surprises not only during quarterly reporting events, but also in his usual way – through the social network X, which he has owned since October 2022. This time, he decided to study public opinion about the possibility of Tesla investing $5 billion in its startup xAI, which is developing a chatbot that competes with the famous ChatGPT.

Image Source: Tesla

The American billionaire is known for his penchant for discussing his investment decisions with followers, and the new xAI startup funding initiative is no exception. Yesterday, Elon Musk (Elon) asked his subscribers on the pages of the social network X about the advisability of investing $5 billion of Tesla’s funds into the capital of the startup xAI. He emphasized that such a decision must be approved not only by Tesla’s board of directors, but also by its shareholders, and the survey is carried out only to study public opinion.

The startup xAI, founded by Musk in 2023, is developing its own artificial intelligence systems, and the billionaire has already established mutually beneficial cooperation between the young company and the social network X, which operates with large volumes of data useful for AI development. This year, xAI has already managed to attract $6 billion in investments; the startup’s capitalization was previously estimated at $18 billion.

When the possibility of a symbiosis between xAI and the automaker was discussed at Tesla’s quarterly conference, Elon Musk explained that “Tesla is learning a lot from xAI” as the startup helps advance the development of full autopilot and the construction of a new Tesla data center. Opportunities for integrating the Grok chatbot with the on-board software of Tesla electric vehicles, according to the head of both companies, exist. In the first three hours after the start of the poll on pages X, the idea of ​​Tesla investing $5 billion in xAI capital was supported by approximately 70% of Musk’s subscribers out of the 386 thousand who took part in the vote. Musk does not share Tesla investors’ concerns about the “dissipation” of the company’s resources, as he stated at the reporting conference.