Elon Musk Outlines Tesla Giga Texas Expansion Plans: New Data Center To Have Over 500MW Capacity In Next 18 Months To Power Own And Nvidia AI Hardware

Tesla Inc TSLA CEO Elon Musk on Thursday said that the company is looking to make space for about 500MW of power and cooling in the next 18 months at its new data center being built at Giga Texas to house the company’s own AI hardware, as well as those from Nvidia Corp. and others.

What Happened: Tesla says it will add about 130MW capacity this year, which will be increased to over 500 MW over the next 18 months.

This Tesla AI hardware will include mostly hardware 4 (HW4) computers and some of the company’s Dojo supercomputer. However, in the second half of next year, hardware 5, renamed to AI5, and with ten times the capability of HW4 computer, will be deployed, he added.

“Play to win or don't play at all,” Musk said about his plans for the center being built.

Why It Matters: The company is completing the construction of the center to the south of Giga Texas and it will house 50,000 of Nvidia's GPU chips designed specifically for AI applications once complete and 20,000 Tesla HW4 AI computers, Musk said earlier this month. 

While Giga Texas covers 2,500 acres along the Colorado River with over 10 million square feet of factory floor, Tesla still needed more space to install the Nvidia GPUs, Musk previously said. Each GPU requires significant power and cooling, thereby mandating an expansion of the factory.

The south extension of the Texas gigafactory is custom-built for heavy power computing and has huge cooling towers, the CEO explained.

Tesla's AI Budget: Earlier in June, Musk revealed that Tesla would spend $3 billion to $4 billion this year on hardware purchases from Nvidia and a majority of its remaining $10 billion AI-related budget internally. Within the company, Tesla will spend on AI inference computers, the sensors present in its cars, and its Dojo supercomputer, Musk said.

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