Elon Musk Diverted Nvidia Chips from Tesla to X and xAI

Elon Musk told Nvidia to redirect graphics processing units reserved for Tesla to the social media site X, which works closely with his artificial intelligence startup xAI, according to CNBC, which cited a December memo written by senior staff at Nvidia. The switch postponed the delivery of $500 million in GPUs to Tesla by months, potentially delaying its progress in developing autonomous vehicle technology, according to the report.

In an email from April, staff at Nvidia also said that Musk’s public statements about spending on AI infrastructure conflicted with Nvidia’s bookings and forecasts, according to the report.

In response to the story, Musk said “Tesla had no place to send the Nvidia chips to turn them on, so they would have just sat in a warehouse.”

News of the diversion of Nvidia chips comes amid a proxy vote at Tesla to ratify a 2018 pay package for Musk, now worth around $44 billion. A Delaware judge canceled the package in January, and Musk’s critics have argued that he is too distracted by responsibilities outside of Tesla to justify the extraordinary pay. Musk has previously said that if he doesn’t receive 25% voting power at Tesla, he will prioritize developing AI outside of the electric vehicle company.