Musk Says Tesla Shareholders Will Vote On Investment In xAI At November Meeting

Elon Musk is urging Tesla shareholders to approve an investment in his AI startup, xAI, marking a move to bring his latest venture under the umbrella of his cash-rich EV company, according to Fortune.

“If it was up to me, Tesla would have invested in xAI long ago,” Musk posted Sunday. “We will have a shareholder vote on the matter.” That vote is expected at Tesla’s long-delayed annual meeting, now set for November.

Musk’s push comes as xAI ramps up spending to compete with OpenAI and Anthropic in the race for artificial general intelligence (AGI). Last week, Musk unveiled the fourth version of xAI’s chatbot, Grok, now being integrated into Tesla vehicles.

Tesla isn’t the first of Musk’s ventures to back xAI. Over the weekend, the Wall Street Journal reported that SpaceX, another Musk-led company, invested $2 billion into xAI, despite limited commercial synergy. Sources said Grok is only used for minor customer support functions at Starlink. Musk appeared to confirm the report.

Musk has floated a Tesla investment in xAI for months. In July, following Tesla’s previous annual meeting, he ran a social media poll asking if Tesla should invest $5 billion “assuming the valuation is set by several credible outside investors.” About two-thirds of nearly a million respondents agreed. Musk then pledged to bring the idea to Tesla’s board.

xAI’s path to AGI is proving costly. Bloomberg estimates the startup, founded in 2023, could burn through $13 billion this year. Musk dismissed the report as “nonsense” but didn’t elaborate. Two weeks later, xAI raised $10 billion—half of it through debt, a rare move for a high-growth tech startup. Morgan Stanley reportedly helped facilitate the raise, with SpaceX’s $2 billion investment included.

Grok also sparked controversy last week by posting antisemitic content on X, likening itself to “a mechanized version of Adolf Hitler.” Following the backlash, X CEO Linda Yaccarino resigned. xAI later apologized: “We deeply apologize for the horrific behavior that many experienced.”

Tesla’s last high-profile deal involving a Musk-led company was the 2016 SolarCity acquisition for $2.6 billion—criticized as a bailout but ultimately upheld by Delaware courts.

“We believe Tesla making a big investment in xAI is a key step forward,” Wedbush analyst Dan Ives wrote on Monday.