Tesla has reportedly dissolved its internal Dojo Supercomputer artificial intelligence division, which focused on developing proprietary AI chips and training AI models for its self-driving systems. This significant organizational change includes the departure of Peter Bannon, the head of the Dojo Supercomputer initiative. Furthermore, more than 20 team members have reportedly transitioned to DensityAI, a new venture founded by former Tesla executives, including Ganesh Venkataramanan, indicating a brain drain from the electric vehicle manufacturer's in-house AI endeavors.
In a strategic pivot, Tesla is reportedly reassigning the remaining Dojo team members to other departments. This move signals a shift towards leveraging external expertise for its AI requirements, with the company now considering collaborations with major semiconductor companies like Nvidia Corp, Advanced Micro Devices Inc., and Samsung Electronics. This shift aligns with recent developments, including a substantial agreement with Samsung, valued at over $16.5 billion, for the production of AI6 chips designed to power Tesla's next-generation self-driving technology. Meanwhile, Tesla's ambitious plans for expanding its robotaxi service in U.S. cities face regulatory hurdles, notably the absence of necessary permits for operations in California.
This restructuring occurs amidst broader challenges for Tesla, including a controversial compensation package for CEO Elon Musk, reportedly exceeding $29 billion, which has solidified his role until 2030. Concurrently, the company is grappling with a notable decline in vehicle sales across various international markets, including significant double-digit drops in the UK and consistent monthly decreases in several European countries such as France, Sweden, and Denmark. Despite these sales challenges, Tesla continues to demonstrate strong performance in key market metrics such as momentum, quality, and growth, although its value proposition in the market appears less favorable.
The strategic decision to cease internal AI chip development and opt for external partnerships, while facing market and operational challenges, underscores a dynamic period for Tesla. This adaptation, coupled with a renewed focus on core strengths and judicious external collaborations, holds the potential to steer the company toward overcoming current obstacles and realizing its ambitious vision for the future of mobility, fostering innovation and progress within the industry.