Elon Musk said Tesla Inc. (NASDAQ:TSLA)  will launch its "Terafab" AI chip project within a week to power its self-driving technology.

Tesla Terafab AI Chip Project

On Saturday, Musk said that Tesla's “Terafab project,“ aimed at producing AI chips, is expected to launch in 7 days, signaling a major step in the company's effort to scale its AI infrastructure.

Tesla is designing its fifth-generation AI chip, AI5, to power the company's autonomous driving systems, including its Full Self-Driving software, reported Reuters.

Musk has previously suggested the company may ultimately need to build its own large-scale chip manufacturing facility to keep up with demand.

"Even when we extrapolate the best-case scenario for chip production from our suppliers, it’s still not enough," Musk said during Tesla's annual shareholder meeting last year.

He added that the company may need to build a large-scale fabrication plant, calling the idea a "Tesla terafab."

"It's like giga but way bigger. I can't see any other way to get to the volume of chips that we're looking for," Musk said.

He added, "So I think we're probably going to have to build a gigantic chip fab. It's got to be done."

Tesla AI And AGI Ambitions

Earlier this month, Musk expressed confidence in Tesla's AI and robotics efforts, saying the company could become one of the developers of Artificial General Intelligence (AGI).

Musk said Tesla would likely be among the companies to create AGI and could potentially be the first to achieve it in humanoid or "atom-shaping" form.

Last month, Tesla began recruiting AI chip designers in South Korea to build high-volume AI chips, seeking engineers to help create what it called the world's most advanced mass-produced AI chips.

Musk said Tesla had previously considered collaborating with semiconductor giants like Intel Corp (NASDAQ:INTC), but had not signed any formal agreements.

The company is already working with chipmakers, including Taiwan Semiconductor Manufacturing Co., Ltd. (NYSE:TSM) and Samsung Electronics Co. (OTC:SSNLF), to produce its AI chips.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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