Tesla CEO considers $5 billion investment in xAI, raising concerns
Recent poll results on social media show strong public support for the investment.
Elon Musk announced plans to discuss a $5 billion investment in his AI startup, xAI, with Tesla’s board. This potential move, preceded by a poll launched on social medial platform X, has sparked concerns about a conflict of interest, as Musk launched xAI to compete with Microsoft-backed OpenAI. A recent social media poll showed strong public support for the investment, with over two-thirds of respondents in favor.
Tesla recently reported lower-than-expected second-quarter results, with declining automotive gross margins and profits. Musk highlighted the potential benefits of integrating xAI’s technologies with Tesla, including advancements in full self-driving and new data centre development. However, critics argue that the investment might not be in the best interest of Tesla shareholders.
xAI, launched by Musk last year, has already raised $6 billion in funding, attracting major investors such as Andreessen Horowitz and Sequoia Capital. Despite Musk’s ambitious plans for xAI, his past ventures have faced scrutiny over conflicts of interest, including the controversial acquisition of SolarCity by Tesla in 2016.
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