Famend tech analyst Ming-Chi Kuo of TF Worldwide Securities has shared some insights on Tesla’s $16.5 billion AI6 cope with Samsung. As per the analyst, the deal is a worthwhile alternative for Tesla to bolster its chip design and manufacturing experience.
Kuo’s endorsement, which was posted on X, highlighted the deal’s potential to reshape the electrical automobile maker’s provide chain and strengthen its standing within the semiconductor panorama.
Tesla’s Strategic Achieve
Kuo, who extensively considered the “finest Apple analyst on the planet” as a result of his eerily correct forecasts, famous that the Tesla-Samsung partnership is a game-changer. He emphasised that Tesla’s entry to Samsung’s Texas foundry will improve the EV maker’s chip design capabilities. This was highlighted by CEO Elon Musk on X, when he acknowledged that he could be strolling the road “personally to speed up the tempo” of the ability’s progress.
“For Elon Musk and Tesla, this represents a worthwhile alternative to realize real-world foundry expertise at an exceptionally low value — one thing TSMC would by no means permit,” Kuo wrote in his X submit.
The deal duties Samsung’s new Taylor, Texas, facility with producing Tesla’s AI6 chips, that are anticipated for use for big quantity merchandise just like the Cybercab and Optimus. Kuo’s evaluation highlighted that the transfer diversifies Tesla’s reliance on Taiwan Semiconductor Manufacturing Co. (TSMC), which has been contracted to supply the EV maker’s AI5 chip.
Challenges and Optimism
Kuo acknowledged dangers in Samsung’s 2nm SF2 course of, which has a decrease yield in comparison with TSMC’s 2nm N2 node. But, he stays optimistic, noting that “Elon Musk’s execution is confirmed, and SF2’s adoption of the identical GAA expertise as SF3 ought to facilitate mass manufacturing.”
Even when Samsung had been to falter, Kuo famous that Tesla may merely shift its AI6 deal to TSMC, absorbing design know-how within the course of. TSMC, in spite of everything, would probably settle for Tesla’s enterprise contemplating the size of the corporate’s Cybercab and Optimus enterprise.
“If manufacturing falls wanting expectations, the worst-case situation for Tesla could be to shift the order again to TSMC and take up the ensuing delays to AI6. Nevertheless, Tesla’s edge in real-world AI may considerably cut back the chance of AI6 delays. Regardless, Tesla nonetheless positive factors from enhanced design capabilities and deeper chip manufacturing know-how,” Kuo wrote.
For Samsung, Kuo sees the deal as a low-risk, high-reward situation. The Tesla deal may then reinvigorate the South Korean tech big’s foundry enterprise, positioning Samsung as a viable TSMC rival.
“If AI6 reaches mass manufacturing easily, chip design and manufacturing may grow to be a core aggressive benefit throughout Elon Musk’s companies — enabling larger flexibility and decrease prices. Whereas Samsung could not totally meet up with TSMC in superior nodes, it has a minimum of found a brand new enterprise mannequin that actively includes clients within the manufacturing course of,” the analyst wrote.
