Elon Musk just shared a poll, asking if Tesla should invest $5 billion into xAI. There are a number of implications for Tesla if this happens, and here they are.
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Tesla and xAI
Elon Musk has done many polls over the years, from asking if he should sell 10% of his Tesla stock, to moving Tesla's headquarters from Delaware to Texas.
Well, he's at it again with another poll, asking if Tesla should invest $5 billion in xAI. So far, the results of the poll are as follows:
* Yes: 68.4%
* No: 31.6%
It looks like overall that people would like to own part of xAI.
I think it's important for Tesla to invest and become part of xAI, actually. Tesla and xAI are doing two different and distinct types of AI. For Tesla, it's real world AI. For xAI, it's language model AI, which focuses on conversation and the retrieval of information.
Tesla's real world AI is more about understanding the reality of the physical world, and it starts with Tesla's FSD software, which makes decisions based on what it sees and experiences in the real world.
Tesla's latest release of FSD version 12.5 is yet another step change improvement in this real world AI. But, Tesla doesn't have anything related to a language model AI, like ChatGPT, and buying a stake in xAI solves this.
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Tesla Should Buy More Than $5 Billion of xAI
There are many implications for Tesla buying a stake in xAI. I think the first implication is that it makes Elon Musk more of a solid long term stay at Tesla. Because Tesla has a stake in xAI if this poll ends up happening, Elon Musk is more motivated in his AI pursuits do to a more consolidated interest in the AI in Tesla.
Second, it gives Tesla exposure to a language model AI in the form of Grok. This language model AI will allow Tesla's vehicles to understand language, voice commands, and to create a car that is an interactive vehicle, like Kit from the 1980s show, Knight Rider.
Gen Munster, a well known analyst on Wall Street, says that Tesla should invest $20 billion of its just over $30 billion cash pile into xAI. This would give Tesla a majority stake in xAI, and completely solidify the AI direction Tesla is going.
Another implication of this is that xAI will accelerate in its AI growth. Both Tesla and xAI will continue to accelerate together through this kind of deal.
I think we will see a $5 billion investment, however, there may be future polls that Elon does for further investment. In addition to that, I think this vote will go to shareholders, who will vote unanimously for it.
I favor this because one day, I'd like to have my car have an interactive personality that I can talk to. It's a small thing, but I think it will be possible if this kind of deal goes through and Tesla integrates with Grok, xAI's language model.
For Further Reading: SD 12.5 Which Feels Like What Elon Promised 12.4 Would Be - A Step Change Improvement Over 12.4 And Is Shown Handling Stubborn Cat
Should Tesla buy a stake in xAI for $5 or $20 billion? What do you think will happen if this takes place?
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Hi! I'm Jeremy Noel Johnson, and I am a Tesla investor and supporter and own a 2022 Model 3 RWD EV and I don't have range anxiety :). I enjoy bringing you breaking Tesla news as well as anything about Tesla or other EV companies I can find, like Aptera. Other interests of mine are AI, Tesla Energy and the Tesla Bot! You can follow me on X.COM or LinkedIn to stay in touch and follow my Tesla and EV news coverage.
Image Credit: Tesla, Screenshot
Article Reference: Tesla
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