Samsung will produce Tesla’s next-gen AI chips at its semiconductor plant set to open next year northeast of Austin in Taylor.

The implication of Musk’s announcement is that Tesla would be giving enough business to Samsung to sustain the first Taylor foundry through 2033. With 1,200 acres at its disposal in Taylor, the company could be investing up to $55 billion in additional fabrication plants at both the Taylor and Austin campuses in the coming years.

Samsung Electronics Co. will produce AI semiconductors for Tesla Inc. in a new $16.5 billion pact that marks a win for its underperforming foundry division.