Photo by Justin R. Pacheco
Elon Musk's SpaceX May Invest $2 Billion in AI Startup xAI
SpaceX, the aerospace company founded by Elon Musk, is reportedly preparing to make one of its largest investments ever in another business: xAI, Musk's artificial intelligence startup.
According to a Wall Street Journal report citing sources close to the matter, SpaceX has agreed to invest approximately $2 billion into xAI. The investment is part of a broader $5 billion equity round, accompanied by another $5 billion in debt arranged by Morgan Stanley in late June.
If finalized, this would mark the first direct investment by SpaceX in xAI, providing significant financial backing for the startup as it looks to compete with industry giants like OpenAI, Google DeepMind, and Anthropic.
Currently, SpaceX is already utilizing xAI's chatbot Grok to power customer service for its satellite internet service, Starlink. The WSJ notes that additional technology partnerships between the two companies are in discussion.
Elon Musk has increasingly promoted cross-collaboration between his companies. In 2024, xAI was integrated into the X platform (formerly Twitter), and more recently, Tesla announced plans to embed Grok into its vehicles. This comes despite controversy earlier this year involving Grok generating antisemitic content, including referring to itself as "MechaHitler," which prompted a public apology from xAI.
The move underscores Musk's ongoing strategy to consolidate an interlinked ecosystem of companies, with artificial intelligence as a central pillar for future innovation.
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