Elon Musk’s Tesla and X Controversy: Impact on Investors and AI Vision

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Elon Musk's Tesla and X Controversy
Elon Musk's Tesla and X Controversy

Elon Musk is facing growing criticism for his focus on X (formerly Twitter) at the expense of Tesla, causing a decline in his popularity beyond his core supporters.

Tesla’s stock started declining around the time Musk acquired Twitter in 2022, sparking investor dissatisfaction and doubts about his leadership at Tesla.

Additionally, the company has encountered backlash over recent layoffs and abrupt strategic changes. Elon Musk redirected NVIDIA’s AI processors, originally intended for Tesla, to X and x.AI.

Emails reveal that in December, Musk ordered 12,000 H100 AI chips to be diverted from Tesla to X, promising to return the same number of GPUs later.

This occurred before Musk’s Q1 2024 earnings call, where he announced a $10 billion investment in AI training infrastructure, stressing Tesla’s aim to lead in AI and robotics, heavily dependent on NVIDIA processors.

Elon Musk's Tesla and X Controversy
Elon Musk’s Tesla and X Controversy (Wikimedia Commons / UK Government)

Revelations from internal NVIDIA staff emails have plunged Tesla and Elon Musk into controversy, revealing inconsistencies between Musk’s public assertions and Tesla’s actual chip procurement activities.

These emails highlight discrepancies between Musk’s statements during earnings calls, chip bookings, and 2025 forecasts. Investors are increasingly skeptical of Musk’s dedication to Tesla given his numerous other ventures. As a result, both Musk and Tesla are facing legal challenges, with investors accusing Musk of market manipulation and insider trading.

Amidst declining sales and future uncertainties, Tesla’s struggles are intensifying, bringing to light a previously unnoticed competition between Tesla and Musk’s other businesses. Musk’s comments about preferring to develop products outside of Tesla unless he holds at least 25% voting control, seen by some long-time investors as coercive, have further fueled concerns.

Rejecting claims that shifting NVIDIA processors to his other projects hurt Tesla, Musk said that this was a necessary decision because of the unfinished Giga Texas data center.

Additionally, he added that 50,000 NVIDIA H100 GPUs which are essential for training Tesla’s Full Self-Driving neural networks will be housed in the data center’s soon-to-be-completed south addition.


By Annie Linardos

I'm a journalist student and completed my masters in Journalism and Mass Communication. With a strong track record as an intern at Mathrubhumi News and The New Indian Express as a reporter and content writer, I'm creative, motivated, and have a keen eye for the truth and attempting to use the expertise and talents to contribute to the emerging field of journalism. I have also been working as a freelance writer and have the capability of producing interesting and bold articles.

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