Elon Musk rules out merger but confirms Tesla investor vote on xAI investment
The billionaire entrepreneur, responding to a post on X, said any decision to back the startup ultimately wasn't his to make. Musk asked X users publicly last year if Tesla should invest $5 billion in xAI, writing at the time that he was just testing the waters. But he said then that the EV maker's board and backers would need to green-light such a decision.
Musk set up xAI in early 2023, months after OpenAI ushered in the AI boom with the launch of ChatGPT. It's since merged with the social media service X in a deal Musk said valued the AI startup at $80 billion and the social network company at $33 billion.
That deal meant the X platform would come in handy to further distribute xAI products, while also providing a real-time feed of users' posts, screenshots and massive amounts of other data.
Investments into xAI would help Grok better compete with OpenAI's ChatGPT by increasing capital toward research and development.
The potential investments emerged as the combined entity xAI Holdings engages in talks to raise money at a valuation of as much as $200 billion, Bloomberg News has reported. They suggest Tesla's billionaire chief executive officer is seeking to more closely entwine the various parts of his corporate empire.
This month, the CEO revealed Tesla will adopt Grok within vehicles — days after the bot posted antisemitic content on X. The integration suggests an expanded relationship between the two firms, something some Tesla investors have called for as EV sales have slumped.
Tesla disclosed in April that xAI was a customer last year, with the startup incurring $198.3 million of expenses tied to commercial, consulting and support agreements with the carmaker. The bulk of that business — $191 million — involved xAI purchasing Tesla's utility-scale energy storage batteries, called Megapack.
Responding to a user post on X asking Tesla investors if they supported a merger between the two companies, Musk on Monday replied "No."
"If it was up to me, Tesla would have invested in xAI long ago," Musk had said on X, having previously signaled that close ties between the companies could help advance Tesla's autonomous-driving ambitions.
Tesla had last week said it was planning to hold its annual shareholder meeting on November 6, setting the date a day after a group of 27 investors pushed for it, citing legal obligations.
(With inputs from agencies)
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India plays an important role in tariff development. It will be interesting to see if there is anything related to pharmaceuticals in any sort of tariff agreement, trade deal that is struck between India and the US. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads "So, you have got a decent macro backdrop in the US. We are seeing consumers healthy based on the results we are getting from banks so far and inflation is starting to come down. Granted, all those tariff impacts are not part of that, but it is still much better than we thought it was going to be," says Matt Orton I do not know if this gives the Fed the reason to start to lower rates immediately, but it should be encouraging for investors. Rates in the US can lower. It has always been my expectation that the Fed would start to cut rates once we get into the fall into September and beyond. And what we are seeing is that we are at least the tariffs that have been imposed so far in the US have not been as inflationary as a number of economists have have been able to manage those costs. And if we do end up getting deals, which it seems like President Trump is really pushing to start accelerating the level of deals that are struck, that should be constructive for the inflationary outlook going forward. So, you have got a decent macro backdrop in the US. We are seeing consumers healthy based on the results we are getting from banks so far and inflation is starting to come down. Granted, all those tariff impacts are not part of that, but it is still much better than we thought it was going to India is going to be very specific to sectors most likely. The US probably would like to see energy similar to Indonesia, commitments to energy purchases from the US, that is something that is doable. I also think seeing commitments with respect to defence cooperation that could be something that ends up as part of these deals. But also, with respect to at least openness of a market. It does not mean that the US has to be competitive in the Indian market but at least having the attempt of US company to be able to compete in the automotive space. Tesla launching the Teslas in India. that is a positive step forward that should also give Trump confidence that India is serious about these deals.I do not think they are going to be that competitive in the Indian market, but at least they can be on a similar level playing field and we will see a trade deal that has the spirit of that behind it and that would be very encouraging for the market because that will at least get rid of one of the uncertainty that is out there and then we as investors can really just focus on the fundamentals more at the micro level knowing that the macro backdrop is going to be a little bit more stable going forward at least with respect to potential disruptions at the government pharma tariffs are definitely going to come. Trump has been serious about this. He has talked about it and kind of accelerated his rhetoric towards pharmaceutical tariffs . It is going to be a negative event for the larger pharma companies in the US your Merck, your Pfizer, companies like that. Healthcare has been an area that has been more challenging across the world to invest in.I would say the companies around the world that are most at risk due to the pharmaceutical tariffs are likely going to be the major pharmas in the US and in Europe, that is going to be the concentration of where there can be challenges to the earnings growth setup going plays an important role in tariff development. It will be interesting to see if there is anything related to pharmaceuticals in any sort of tariff agreement, trade deal that is struck between India and the at the end of the day, India plays an important role. You cannot just go cold turkey immediately. There is going to be have some sort of draw down period and that will give cover to some of the Indian pharmaceutical companies that do play a really critical role in the supply chain for pharmaceuticals overall.
