Tesla Investor Ross Gerber Thinks Elon Musk's Decision To Redirect Nvidia AI Chips To X, xAI Is A 'Weird Excuse'

Investor Ross Gerber criticized Elon Musk for redirecting Nvidia chips meant for Tesla Inc. TSLA to his social media company, X, and xAI.

What Happened: Gerber, a Tesla investor, commented during CNBC’s “Last Call” on Tuesday, on Musk’s explanation that Tesla had no facilities to activate the Nvidia chips, which would have otherwise sat idle in a warehouse.

“To say that you don't have room for something is a weird excuse for the biggest factory I've ever seen,” he said.

Gerber added that Musk’s motivation for diverting the chips is to focus on robotics and “robotaxi idea” at xAI over autonomous self-driving.

“Full self-driving is one solution of AI. So, by using xAI, he controls the brains that would control everything else and that’s what this is all about,” he added.

See Also: Nvidia’s Race With Apple, Ark Invest’s Big Moves And AI’s Future In Smartphones: Top Updates This Week In

Why It Matters: The redirection of 12,000 Nvidia H100 GPUs from Tesla to X and xAI has significant implications. This move could delay Tesla’s supercomputer development, which is crucial for its AI and robotics advancements.

Musk defended his decision by stating that Tesla had no immediate use for the chips, and they would have just sat in a warehouse. He mentioned that the south extension of Giga Texas, which will house 50,000 H100s for Full Self-Driving (FSD) training, is nearing completion.

However, this explanation has not quelled concerns. Critics argue that the redirection could hinder Tesla’s progress in AI and self-driving technology, areas where the company has heavily invested.

Price Action: According to Benzinga Pro, on Tuesday, Tesla stock closed 0.86% lower at $174.77 while Nvidia closed 1.25% higher at $1,164.37.

Read Next: AMD Shares Rise Pre-Market After Semiconductor Giant Unveils New AI Chips To Challenge Jensen Huang’s $2.7 Trillion Nvidia Empire

Photo via Shutterstock

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari

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