Tesla's AI Ambitions: Nvidia CEO's Approval

Tesla and AI

Tesla has big goals for artificial intelligence (AI), but it isn't yet changing the company. The biggest companies working on AI include Microsoft, Nvidia, Apple, Alphabet, Amazon, Meta Platforms, and Tesla. Microsoft, Amazon, and Alphabet have already seen benefits from AI, especially in cloud computing. Apple and Meta are working to add AI to their devices, and Nvidia's GPUs are important for generative AI. But what about Tesla? The company is developing self-driving software and wants to build a ride-hailing fleet called the Robotaxi. For now, Tesla's AI plans are more of a vision than a reality. While some investors are unsure about Tesla's plans, Nvidia's CEO, Jensen Huang, has shown support for Elon Musk.

Huang's Praise for Musk

Musk also manages other businesses, including a start-up called xAI. This start-up created a supercomputer named Colossus, which uses many of Nvidia's GPU chipsets and plans to use more. Huang praised xAI because of how quickly they got Colossus running. According to Huang, designing the infrastructure for Colossus would normally take about three years, with another year to build it. However, Musk and the xAI team built Colossus and had it running in only 19 days! Huang said that what xAI has done is "singular."

Integrating xAI with Tesla

One of Tesla's main AI goals is to build a fleet of robotaxis. Currently, Tesla trains its models for self-driving cars using a custom supercomputer called Dojo. By combining xAI with Tesla, Musk could create a beneficial connection between his AI businesses. Tesla vehicles will keep gathering data from drivers, which xAI can use to train FSD models faster. Tesla can then use these improved models in its fleet, strengthening the robotaxi network.

Combining xAI with Tesla could also lower costs by reducing capital expenditures. By using xAI, Tesla can save money on data, computing, and product integration, giving the company more financial flexibility and reducing its reliance on outside hardware vendors. These ideas might be encouraging regarding Tesla's AI plans, but they are still just concepts for now. Recent stock activity suggests that investors are excited about Tesla's entry into the robotaxi market next month. A 50% increase in the share price in one month suggests that the potential benefits from the company's AI efforts may already be reflected in the stock price. While there is optimism about Tesla's future, it might not be wise to buy the stock right now.