As for Tesla, a $16.5 billion agreement was made with Samsung for the production of advanced chips to be used in electric cars to be released in the future.
The deal will be effective for 2025 through the end of 2033. The semiconductor division of the South Korean company, Samsung Foundry, will take care of the manufacturing.
The initial chip to be manufactured under this agreement will be Tesla’s new AI6 chip designed to underpin the firm’s future self-driving software.
They will be manufactured with 2nm manufacturing process from Samsung at its new, currently being built factory in Taylor, Texas.
The news has been confirmed by Tesla’s CEO Elon Musk via X and states that the partnership is of huge importance.
Samsung also said (via Tesla) that the factory has benefitted from Tesla’s assistance in optimizing its production process.
Musk stated that he would personally come to the site in order to urge work to speed up and work more effectively, saying that the plant isn’t far from his apartment.
Shortly after the announcement, Samsung saw its share price jump nearly 7 percent to the highest point since September 2024.
Associated suppliers also fared well: Soulbrain Co. gained as much as 16%.
For Samsung Foundry, this deal is a major win as the foundry had trouble getting decent production yields on its 2nm and 3nm chips and getting enough customers.
Samsung has already manufactured Tesla’s AI4 chips and the next AI5 chip from Tesla is being produced by TSMC, the other largest chip manufacturer.
Still, TSMC allegedly does not develop to all the needs of Tesla and Samsung has shown an eagerness to go hand-in-hand with Tesla which, perhaps, led to the new contract.
According to industry experts, this tie-up has the potential to bolster Samsung’s sales in the chip market and make it a more competitive player for new customers going forward.
The announcement also coincides with efforts to ramp up its chip-making facilities, which had been running under capacity.
