Samsung's Taylor, Texas plant will begin producing the A16 chip for new Tesla vehicles and robotaxis in the years ahead.

Tesla Chief Executive Elon Musk announced the deal today in a series of posts on X. He suggested that the contract’s value could grow significantly over time. “The $16.5B number is just the bare minimum,” Musk wrote in one of the posts. “Actual output is likely to be several times higher.”

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