Samsung landed a $16.5 billion chip deal with Tesla to manufacture AI chips. The news dropped in a regulatory filing, with Tesla CEO Elon Musk spilling details on X.
Samsung will produce Tesla’s next-gen A16 AI chips at its new Texas plant near Austin.
Musk called the deal hugely important: 
“The strategic importance of this is hard to overstate,” Musk wrote.
“Samsung has agreed to allow Tesla to assist in maximising manufacturing efficiency.”
“I will walk the [manufacturing] line personally to accelerate the pace of progress.”
“The Samsung plant in Taylor, outside Austin, Texas, is conveniently located not far from my house.”
The contract runs until the end of 2033.
This deal comes after the Biden administration backed Samsung’s Texas chip facility with $4.75 billion in Chips Act funding, aiming to boost US chip production for AI and national security.
Samsung’s Texas plant had been struggling to land big customers. Analysts said the Tesla deal is a big win and could revive the stalled project. The plant’s operational start is now pushed to 2026.
Samsung already makes Tesla’s AI4 chips, used in Tesla’s full self-driving system. Tesla plans to have Taiwan’s TSMC make its upcoming AI5 chips, with production set for Taiwan and Arizona.
Samsung declined further comment.
