Tesla’s AI5 Chip Production Confirmed: TSMC AND Samsung Join Forces in Elon Musk’s Bold Move

Elon Musk just dropped a semiconductor bombshell—Tesla's cutting-edge AI5 chips will roll off production lines at both TSMC and Samsung facilities.

The Dual-Foundry Strategy

Musk's play splits manufacturing between the world's two largest chipmakers—a power move that secures supply chain diversity while pitting tech titans against each other. No more single-source dependency that's haunted automakers for years.

Production Power Play

This isn't just about securing capacity—it's about dominating next-generation automotive computing. Tesla's betting big that dual-sourcing will accelerate their AI ambitions while keeping costs competitive. Because nothing says innovation like making your suppliers compete for your business.

The semiconductor industry watches as Musk once again rewrites the rulebook—proving that in the high-stakes game of chip manufacturing, sometimes the best strategy is to play both sides. Wall Street analysts are already scrambling to update their models, because when Musk moves, markets follow—whether they understand the technology or not.

Samsung signs $16.5 billion deal and joins Tesla’s AI push

Back in July, Elon confirmed that Samsung WOULD also make Tesla’s AI6 chip, the next generation after the AI5. That followed a Cryptopolitan report about a $16.5 billion deal between the two companies, which gave Samsung’s foundry division one of its largest outside orders.

Elon had said then that Samsung was already handling the older AI4 chip, while TSMC was responsible for the AI5. The update now means both companies will be producing Tesla’s current AI hardware, splitting the workload across two supply chains.

Samsung may still trail TSMC, but this deal gives it a visible foothold in one of the most high-profile chip programs in the world.

For Tesla, it means less reliance on a single supplier and more production capacity as the company ramps up development for its autonomous driving software and humanoid robots.

Elon didn’t reveal how the chip work will be divided, only saying both partners are “focused initially on AI5.”

But the call wasn’t just about chips. Musk completely skipped any update on EV demand, especially after the federal tax credit expired last month. There was no mention of Cybertruck, and he didn’t touch tariffs or fourth-quarter guidance either, which is pretty unusual..

Elon outlines robotaxi rollout and teases new Optimus robot

Instead of talking about cars or profits, Elon went straight to his comfort zone; robotaxis and robots. He told investors that the company’s self-driving plans are about to “take off like a shock wave.”

Elon claimed Tesla already has “millions of cars out there that, with a software update, become full self-driving cars,” adding that Tesla is “making a couple million a year.”

He said robotaxi service will begin in Austin by the end of this year, running without human drivers. By late 2025, the service should expand to eight to ten cities, though early versions will still keep drivers on board.

Tesla’s Chief Financial Officer Vaibhav Taneja added that adoption of FSD Supervised, the company’s partially automated system, remains “small,” with just 12% of users paying for it. He didn’t disclose pricing, only saying Tesla ran several promotions to boost signups.

After discussing robotaxis, Elon turned to the Optimus humanoid robot, saying it could become “the biggest product of all time.” The robot isn’t on the market yet, but he described new capabilities, saying “Optimus will be an incredible surgeon.”

Elon said that with both Optimus and self-driving tech, “you can actually create a world where there is no poverty, where everyone has access to the finest medical care.”

He also said Tesla would demo a new version called Optimus V3 in the first quarter of 2026, promising significant upgrades from the current prototype. The call ended with him returning to the robot topic over and over again, tying it to his controversial $1 trillion pay package.

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