Intel stock climbed after Tesla CEO, Elon Musk revealed Tesla may collaborate with the chipmaker to build massive AI manufacturing facilities.
Intel’s stock jumped more than 2% on Friday November 7, 2025, after President Elon Musk hinted that Tesla may partner with the U.S. chipmaker to build advanced artificial intelligence manufacturing plants. The comments, made during Tesla’s annual shareholder meeting, sent Intel’s shares up by as much as 4% in after-hours trading.
Speaking before a packed audience, Musk said Tesla might need to construct what he described as a “gigantic chip fab” to produce enough AI chips for the company’s expanding autonomous driving and robotics programs. He suggested that Intel could become a partner in the effort, noting that “it’s probably worth having discussions with Intel,” although no deal has been signed.
Intel, which has been seeking new clients for its chip foundry operations, declined to comment on the remarks. The company is in the midst of a broad turnaround strategy, hoping to regain competitiveness in an industry now dominated by Nvidia and AMD.
Tesla is currently developing its fifth-generation AI chip, which powers its Full Self-Driving systems. Musk said that even with current suppliers Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung, Tesla may not have sufficient production capacity to meet future demand.
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“I can’t see any other way to get to the volume of chips that we’re looking for,” Musk said, adding that a new facility would need to produce at least 100,000 wafer starts per month. He projected that limited production of Tesla’s AI5 chips could begin in 2026, with full-scale output following in 2027.
Musk also outlined plans for a next-generation AI6 chip, expected to double performance while using the same manufacturing lines as the AI5. Volume production could start by mid-2028.
For Intel, a potential partnership with Tesla would mark a significant step toward expanding its foundry business and gaining ground in the fast-growing AI hardware market. The U.S. government recently acquired a 10% stake in Intel as part of a broader initiative to strengthen domestic semiconductor manufacturing.
Tesla shareholders, meanwhile, approved a $1 trillion compensation package for Musk during the meeting, underscoring investor confidence in his vision to transform the company into a global leader in AI and robotics.
“I’m super hardcore on chips right now,” Musk told shareholders with a grin. “I have chips on the brain.”
