According to Elon Musk, CEO of Tesla, the US automaker has agreed to pay $16.5 billion to source semiconductors from Samsung Electronics, which is anticipated to help the South Korean tech giant’s struggling contract manufacturing division.
Following the announcement of the acquisition on Monday, Samsung’s stock shot up about 7%. This comes as the leading memory chip manufacturer in the world is under increasing pressure to build artificial intelligence chips, falling behind competitors like TSMC and SK Hynix.
Musk claimed that Tesla’s next-generation AI6 chip will be produced at Samsung’s new chip factory in Taylor, Texas, which could revitalize the project after it has been delayed for a long time due to Samsung’s struggles to draw in and keep big customers.
The minimum amount is $16.5 billion. In another article, he stated, “The actual output is probably going to be several times higher.” While Tesla shares were up 1.9% in pre-market trade in the US, Samsung shares surged 6.8% to their highest level since September of last year.
Although the sale could only account for a small percentage of Samsung’s yearly logic chip revenue, Ryu Young-ho, a senior analyst at NH Investment & Securities, said that the Taylor factory “had virtually no customers up to this point, so this order is quite meaningful.
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