Musk outlined Tesla’s AI hardware setup and vehicle scale, while Nvidia CEO Jensen Huang hyped up the EV maker’s autonomous driving stack.
- Tesla combines Nvidia training hardware with in-house AI4 chips to manage overall AI costs.
- Musk highlighted Tesla’s scale, with about 2 million AI-equipped vehicles produced annually.
- Nvidia CEO Jensen Huang said Tesla’s autonomous driving stack is the most advanced in the world.
Tesla Inc. CEO Elon Musk on Tuesday criticised the broader automotive industry for lagging in artificial intelligence development, while outlining the scale of the EV maker’s spending on Nvidia hardware and its own in-house AI systems.
Musk said on X that Nvidia is “providing helpful tools to the automotive industry,” but added that the automotive industry itself is “doing very little on their own.”
He added that Tesla will have spent about $10 billion cumulatively on Nvidia hardware for AI training by the end of this year. Musk said Tesla combines that spending with its own AI4 chips to process large volumes of video data, adding that without its own chips, the company would likely need to spend double that amount.
He also pointed to Tesla’s manufacturing scale, saying the company is producing around 2 million vehicles a year and rising, each equipped with a dual system-on-chip AI4 setup, eight cameras, redundancy in steering actuation and other systems, along with high-bandwidth communication.
Nvidia’s Alpamayo And The ‘Long Tail’ Debate
Musk’s comments followed Nvidia’s recent launch of Alpamayo, a family of autonomous driving AI models, simulation tools and datasets aimed at addressing rare and complex driving scenarios using reasoning-based approaches.
Musk said he was “not losing any sleep” over the launch and added that he genuinely hopes Nvidia’s effort succeeds. He said the approach reflects what Tesla is already doing, while cautioning that rare and complex edge cases remain the hardest part of autonomous driving.
In a separate post on X, Musk said, “Well, that’s just exactly what Tesla is doing,” adding that it is “easy to get to 99% and then super hard to solve the long tail of the distribution,” referring to complex scenarios that autonomous systems struggle to handle.
Nvidia CEO Backs Tesla’s Autonomous Stack
Jensen Huang responded to Musk’s remarks by praising Tesla’s autonomous driving technology, calling it the most advanced in the industry, according to an interview with Bloomberg.
Huang said Tesla’s autonomous vehicle stack and operations are the most advanced in the world and that Tesla was already using end-to-end AI. He said whether Tesla’s system explicitly incorporates reasoning is secondary to the broader challenge Musk highlighted, noting that achieving the first 99% of autonomous capability is difficult, while solving the long tail is even harder.
Huang said Nvidia’s approach is also vision-based, supplemented with radar and lidar, and described Tesla’s system as state-of-the-art. He said Tesla’s stack is hard to compare with others and said he would not criticize it, instead encouraging Tesla to continue its current approach.
Tesla-Nvidia Ties Extend Beyond Autonomy
Nvidia is among the investors in Elon Musk’s xAI, which said on Tuesday that it completed an upsized Series E funding round, raising $20 billion and exceeding its $15 billion target.
xAI said Nvidia, alongside other investors, is supporting the rapid scaling of its compute infrastructure and the buildout of what it described as the world’s largest GPU clusters. The company said it ended 2025 with more than one million H100 GPU equivalents deployed across its Colossus I and II data centers, which power training for its Grok models and related AI products.
How Did Stocktwits Users React?
On Stocktwits, retail sentiment for Tesla was ‘extremely bullish’ amid ‘extremely high’ message volume.
On Stocktwits, retail sentiment on Tesla was ‘extremely bearish’, while sentiment on Nvidia was ‘bullish’, with message volume described as ‘high’ for both stocks.
One user said investors should “relax,” arguing that remarks from Jensen Huang highlighted how difficult it is for rivals to match Tesla due to a lack of real-world driving data, adding that Tesla is continuously collecting billions of miles of real-world data without relying on simulation.
Another user focused on Tesla’s valuation, saying: “Tesla is priced way too high. It's due for a major drop to $360-380. Fundamentals don't match up with the price”
While Tesla’s stock has risen 5% over the past 12 months, Nvidia’s stock has jumped 30% over the same period.
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