‘Tesla is far ahead in self-driving cars’ – Elon Musk receives praise from Nvidia’s Jensen Huang

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Nvidia’s star founder Jensen Huang endorsed Tesla’s AI autonomous vehicle strategy, weeks ahead of a key vote that will determine whether CEO Elon Musk receives his record compensation.

Musk is all but betting on his recent move to AI, having quietly undermined his vision of increasing volumes more than tenfold to 20 million vehicles per year by 2030 – as much as Toyota and Volkswagen sell combined.

“Tesla is far ahead in self-driving cars,” Huang testified in an interview with Yahoo Finance uploaded on YouTube late last week.

The AI ​​pivot is controversial because it moves Tesla further away from its stated mission of accelerating the global transition to sustainable transportation. And while Musk’s so-called “supervised Full Self-Driving” is perhaps the best-known advanced driver assistance system (ADAS) on the market, few customers saw the value in forking out $15,000 for a system that required them to watch their car. as it attempts to navigate the city streets.

As a result, Musk was forced to drop the price to $8,000, the level it was at when he first launched the FSD beta in October 2020.

High quality approval

A statement of support from, among others, Huang, whose draw developer conferences filling entire stadiums now could go a long way toward allaying investor concerns that he himself might have veered off course.

“The technology is truly revolutionary and the work they are doing is incredible,” the Nvidia boss continued.

In a few weeks, shareholders will vote for a second time on Musk’s record package — worth roughly $55 billion at the current share price — after a Delaware court in January invalidated the original 2018 vote on procedural grounds related to took into account the quality of Tesla’s shares. management.

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With proxy advisors like Glass Lewis now recommending that investors vote against approving Musk’s pay, the outcome of the June 13 annual meeting is proving to be tighter than expected.

A show of confidence in his new AI strategy from someone like Huang could boost his chances. Few businesspeople are as respected as Huang, who founded Nvidia and managed its exponential growth in recent years thanks to a foresight in repurposing graphics processors to train AI models like OpenAI’s flagship GPT-4o.

Musk and Tesla are gobbling up Nvidia AI chips at a record pace

Huang praised the twelfth and latest version of Tesla’s Full Self-Driving (FSD) software, which abandoned the previous approach of hard-coding commands in computer language and relied solely on an AI-compatible neural network.

“It’s learning from watching videos,” Huang said. “This technology is very similar to the technology of large language models, but only requires a huge training facility and the reason for that is that the data rate of video, the amount of data, is so, So high.”

That said, Huang also knows how important Tesla is as a customer. Musk is a voracious customer of Nvidia’s AI training chips and has more than doubled his computing power in the near future. first quarter during the last three months of last year.

During that time, Tesla has spent a staggering $1 billion building out its AI infrastructure, and that’s just the beginning. Tesla predicts that its computing capacity, equivalent to 35,000 GPU clusters, should reach 85,000 by the end of the year, after which the company may have spent $10 billion.

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To afford that kind of investment at a time when his core auto business must continue to offer margin-eroding incentives to prevent sales from collapsing, Musk is willing to go to great lengths to cut costs elsewhere.

He has already laid off thousands of workers, laid off the team behind his industry-leading Supercharger network and scrapped plans to invest in entirely new assembly lines for his upcoming $25,000 entry-level model, now widely expected to be a Model 3 hatchback.

But if it helps Tesla maintain its leadership in the EV industry — and make Musk $55 billion richer in the process — those sacrifices may not have been in vain.

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