Tesla has signed a $16.5 billion deal with Samsung, locking in a massive supply agreement that runs through 2033 and could provide a lifeline for Samsung's struggling foundry division.
Tesla will source its AI6 semiconductors from Samsung, giving the South Korean tech giant a boost just as it faces shrinking market share in chip manufacturing. Samsung's share of the global foundry market recently dipped from 8.1 percent to 7.7 percent, while industry leader TSMC holds a dominant 67.6 percent.
Tesla's system-on-chips power its vehicles and, in the future, will also be used in its Optimus humanoid robots, handling perception and planning for Tesla's FSD (Full Self-Driving) system. Samsung already manufactures Tesla's HW4 (Hardware 4) chips, which are currently at the heart of the FSD platform. The next generation, AI5 (previously known as Hardware 5), is set to be produced by TSMC starting in late 2026 - first in Taiwan, then later at a new facility in Arizona.
The deal is seen as a vote of confidence in Samsung's upcoming 2-nanometer fabrication technology and could help the company's foundry business run closer to full capacity.
