Elon Musk builds a mega AI factory with a million GPUs.

On May 20th,NASDAQ Stock Exchange US time, Tesla CEO Elon Musk publicly announced at the Qatar Economic Forum that he plans to continue serving as Tesla's CEO for the next five years and simultaneously promote the expansion plans of his AI company xAI. On that day, Musk confirmed that xAI is building a colossal AI factory, Colossus, outside Memphis, Tennessee, with the goal of deploying up to one million GPU chips, aiming to create the world's largest AI training cluster.

xAI Builds Super Factory Colossus, Globally Leading GPU Deployment
Musk revealed that the AI factory has already installed 200,000 GPUs and will continue to expand. He claimed, "This is currently the world's most powerful AI training cluster." Although he did not disclose the complete procurement details, he emphasized that he had predicted years ago that "the main bottleneck of AI would be chips." Now, he believes the next limiting factor will quickly shift to energy, predicting that by mid-2026, the AI industry will face a "fundamental power shortage."

The establishment of the Colossus factory aims to transform the Memphis area into a "high-tech manufacturing center." xAI and Tesla are making significant investments to procure high-performance chips from manufacturers like NVIDIA and AMD for large-scale AI model training and autonomous driving algorithm development. Musk also revealed that Tesla's Dojo supercomputer in Buffalo, New York, is using NVIDIA GPUs to train its Autopilot system and humanoid robot "Optimus."

Tesla's AI Strategy Continues Progress, Robotaxi to Hit the Road by End of June
Musk emphasized that AI is not only xAI's core business but also the focus of Tesla's future development. Tesla is continuously using AI to advance its autonomous driving projects. He announced that autonomous taxis (Robotaxi) would begin trial operations in Austin, Texas, by the end of June, marking an important milestone in the commercialization of the company's autonomous driving technology.

Although investors have expressed concerns over Musk's multitasking, he reiterated at the forum that he would continue to lead Tesla. In response to whether xAI and Tesla might merge, he stated that it has not been considered yet, but he does not rule out the possibility, subject to shareholder approval.

Tesla Faces Market Challenges, Musk Responds to Pressure

Tesla is currently facing profitability challenges. The first-quarter financial report showed a 20% decline in automotive revenue and a 71% year-on-year slump in net profit. Although the stock price has rebounded over 40% in the past month, the market value has not returned to one trillion dollars. As of the close on May 20th, Tesla's share price had fallen about 15% year-to-date.

In public affairs, Musk once led Trump's "Government Efficiency Unit," which sparked controversy due to large-scale public staffing cuts. Now, he claims to be cutting political campaign expenses significantly, focusing more on corporate governance and technological innovation.

Looking Ahead: Energy Bottlenecks and Cultural Differences in Innovation

Concluding the forum, Musk discussed the differences in AI development between China and the US, noting that China has surpassed the US in investing in power generation infrastructure, while the US still leads in breakthrough innovations. "This is partly due to cultural differences—real breakthrough innovation requires having the courage to challenge authority."

Musk is rapidly advancing his AI empire while stabilizing Tesla's foundation. He is expanding chip and energy layouts while promoting the deep integration of AI and autonomous driving. A new race entwining technology and capital is accelerating in his hands.

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