Musk says he does not support Tesla, xAI merger
UNITED STATES, JUL 14 – Elon Musk rejects Tesla-xAI merger but will seek shareholder approval for Tesla’s investment to boost AI development and compete with OpenAI, amid a $5 billion funding round.
- Elon Musk clarified that he does not favor combining Tesla and xAI into a single entity and revealed that Tesla shareholders will vote on a proposal for the company to invest in xAI.
- This follows xAI's acquisition of Musk's social media platform X in March for $33 billion, which valued the combined company at $80 billion.
- Tesla’s recent financial performance includes a 71% profit plunge in Q1 and a 13% delivery drop in Q2 to 384,122 vehicles, with shares down more than 16% this year.
- Musk revealed on X that, in his view, Tesla should have made an investment in xAI much earlier. Meanwhile, last May, xAI secured $6 billion in funding from backers such as Sequoia Capital and Saudi Prince Alwaleed Bin Talal.
- The events suggest Tesla investors remain cautious amid Musk's multiple leadership roles and the need for significant capital in the AI race as Tesla integrates xAI technology.
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