Tesla to hold shareholder vote on whether to invest in xAI

Tesla is set to conduct a shareholder vote regarding a potential investment in xAI, the artificial intelligence startup founded by Elon Musk. Musk revealed this decision via a post on his social media platform, X, which is also linked to xAI. He expressed his long-standing belief that Tesla should have invested in xAI much earlier. As Musk aims to position xAI competitively against industry giants such as OpenAI, Meta, and Google, he has been channeling resources from his other ventures into the startup. Recently, xAI made headlines with its acquisition of X, which has been utilized for training data and distributing its AI chatbot, Grok. Furthermore, reports indicate that SpaceX, another Musk-led company, is poised to invest $2 billion into xAI. However, securing Tesla's investment in xAI may present challenges, especially since Tesla is a publicly traded entity. Some shareholders have expressed unease over Musk's various commitments, urging him to allocate a minimum of 40 hours each week to his role as Tesla's CEO or to establish clear boundaries concerning his outside engagements. In previous discussions, Musk has dismissed the notion of a merger between Tesla and xAI. While Tesla's stock saw a slight uptick early on Monday, it remains over 16% lower than its value at the beginning of the year. In a related development, Tesla announced its annual shareholder meeting, scheduled for November 6, following a wave of inquiries from shareholders eager to understand the delay in organizing the event. xAI has garnered significant investment interest, not only from Musk's enterprises but also from prominent investors. In May, the company raised $6 billion from firms including Sequoia Capital and Andreessen Horowitz, elevating its valuation to $24 billion. Following its purchase of X, Musk asserted that the valuation of the combined entities reached $80 billion. Recently, xAI has aimed to secure an additional $10 billion at a staggering valuation of $200 billion, according to Bloomberg.