South Korean conglomerate Samsung Electronics announced on Monday that it had received a semiconductor supply order worth 22.8 trillion won (about $16.4 billion), without identifying the client. Hours later, Elon Musk confirmed that Tesla had placed the order, suggesting the deal could be much larger.
“Samsung has agreed to help Tesla maximize its production efficiency. Samsung's massive new factory in Texas will be used to produce Tesla's next-generation AI6 chip. The strategic importance of this agreement is difficult to overstate,” Musk wrote on the X platform. He added that the $16.5 billion figure is “just the bare minimum,” and actual production will likely be many times higher. The agreement is expected to run until 2033.
The value of the contract, as the South Korean conglomerate said in a statement, is approximately 7.6 percent of Samsung's estimated turnover for 2024.
While a detailed production schedule for AI6 chips has not been provided, production is expected to begin after the end of AI5 chip production in late 2026.
Tesla AI chips are advanced processors specially designed by the company, which are crucial for the development of software and technologies for autonomous driving systems (Full Self-Driving) and robotics (including Optimus humanoid robots).
The deal is a significant boost for Samsung, which has been struggling to compete in the artificial intelligence chip market, losing ground to leaders like Taiwan Semiconductor Manufacturing Co. (TSMC) and South Korea's SK Hynix. As Ryu Young-ho, an analyst at NH Investment & Securities, notes, Samsung's Texas plant “has had virtually no customers until now, so this order is very significant.”
Following the announcement of the agreement, Samsung Electronics shares rose 6.83 percent and closed at 70,400 won.
Musk also added that Samsung Electronics is currently producing AI4 chips, while rival TSMC will produce AI5 chips for Tesla. The design of these chips has just been completed, and production will begin first at TSMC's facilities in Taiwan and then in Arizona.
Krzysztof Pawliszak (PAP)
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