(Reuters) - Tesla will simplify its artificial intelligence chip development efforts and focus on developing inference chips for running AI models and making real-time decisions, CEO Elon Musk said. Earlier media reports said he had ordered the closure of the company's internal Dojo supercomputer team.
Bloomberg News reported on Thursday, citing people familiar with the matter, that Musk had ordered the dissolution of the Dojo team, and that its leader, Peter Bannon, had left the company.
Tesla did not respond to Reuters' request for comment.
The Dojo supercomputer is designed around custom training chips to process the massive amounts of data and video generated by Tesla electric vehicles to train the automaker's autonomous driving software.
“Tesla has no need to spread its resources thin by developing two completely different AI chip designs,” Musk said in a post on X on Thursday evening.
“Tesla's AI5, AI6, and subsequent chips will be very suitable for inference and also quite good for training. All efforts are focused on this,” he said, without directly mentioning Dojo.
A team led by Morgan Stanley analyst Adam Jonas valued the Dojo supercomputer at $500 billion in 2023, describing it as opening up a new market for Tesla beyond car sales, similar to how Amazon's cloud computing business drove profit growth for the e-commerce company.
“Dojo is a key accelerator at the intersection of hardware and software,” the investment bank stated on August 4. Jonas did not immediately respond to inquiries about whether the latest developments would impact Tesla's valuation.
Tech companies are increasingly designing custom chips to reduce latency, lower power consumption and costs, while consolidating around fewer architectures.
Tesla has undergone a restructuring over the past year, with its stock price plummeting due to intensifying competition in electric vehicle sales and strong opposition from European consumers to Musk's political views.
The company has seen the departure of several senior executives and the layoff of thousands of employees, shifting its focus to AI-driven autonomous driving technology and robotics. Musk is driving an integration strategy for his tech business empire.
Musk stated that the next-generation AI5 chip will enter production by the end of 2026. Last month, he also announced a $16.5 billion agreement with Samsung Electronics to procure AI6 chips, though no specific production timeline was disclosed.
According to Bloomberg, approximately 20 employees from the Dojo team recently left to join the newly established DensityAI company, while the remaining employees are being reassigned to other data centers and computing projects within Tesla.
