Tesla to offer shareholders chance to invest in xAI: Elon Musk

Economic Times

2 days ago

AP Tesla will give its shareholders the option to invest in artificial intelligence startup xAI, billionaire owner of both companies Elon Musk said on his social media platform X."It's not up to me... We will have a shareholder vote on the matter," Musk said in response to a social media user suggesting that the electric car maker take a stake in xAI, which recently acquired X.
"If it was up to me, Tesla would have invested in xAI long ago," the world's richest man said. According to the Wall Street Journal, another company controlled by Elon Musk, SpaceX, will invest $2 billion into xAI as part of its $5 billion capital raise.Responding to an X user who cited the WSJ's news story, Musk said that "it would be great" but would depend on "board and shareholder approval."Since the launch of xAI -- which developed the generative AI assistant Grok -- Musk has floated the potential synergies between the AI start-up and his two crown jewels, SpaceX and Tesla.According to the Financial Times, the businessman is seeking a valuation between $170 and $200 billion for xAI in a new funding round.Launched in July 2023, xAI is hoping to catch up with its major generative AI competitors, OpenAI (ChatGPT), Anthropic (Claude) and Google (Gemini). The start-up has invested heavily in a gigantic data center in Memphis, Tennessee, which Musk claims will become the "most powerful AI training system in the world."He has purchased another plot of land nearby to create more data centers, which are essential for developing and running large-scale artificial intelligence models. According to Bloomberg, xAI is costing over a billion dollars every month as it builds upgraded models, with its expenses far exceeding its revenues.xAI's virtual assistant Grok has been the source of a series of controversies. After an update on July 7, some of the chatbot's responses praised Adolf Hitler and suggested that people with Jewish surnames were more likely to spread online hate. On Saturday, xAI apologized for offensive posts, announcing that it had corrected the instructions that had led, according to the company, to these slip-ups. Elevate your knowledge and leadership skills at a cost cheaper than your daily tea. The 10-second mystery: Did the Air India crash report hide more than what it revealed?
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