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Published: Fri, September 22, 2017
Economy | By Melissa Porter

AMD And Tesla Reportedly Developing AI Chips For Autonomous EVs

AMD And Tesla Reportedly Developing AI Chips For Autonomous EVs

It looks like AMD might have scored a seriously large contract through electric auto maker Tesla Motors, with the companies collaborating on a new AI accelerator for self-driving cars.

More than 50 people are working on the project under Jim Keller, a longtime chip architect and the head of Autopilot hardware and software of Tesla, according to the report.

The CNBC report said that its sources tied AMD and Tesla together, but neither AMD or Tesla will comment on the situation.

AMD would help provide Tesla with development of the chip. According to CNBC, Tesla previously used chips from Mobileye but ceased that relationship after an accident involving a Mobileye-powered Tesla.

Tesla is expected to come up with its first-ever autonomous vehicle with self-driving capabilities in 2019.

The AMD/Tesla news came just one day after Bernstein analyst Max Warburton said Tesla's self-driving technology is "exaggerated" and that there is very little difference between the autonomous driving capabilities of Tesla and German automakers, such as BMW and Volkswagen AG.

While Tesla is an important customer for Nvidia, Nvidia also touts partnerships with a number of other vehicle companies, including Toyota, Audi, Mercedes-Benz, and BMW.

AMD shares closed up 62 cents, or nearly 5%, at $13.74, following CNBC's headline, and are up another 87 cents, over 6%, at $14.62, in late trading. Nvidia fell on the news and is down 2.03% on Thursday.

A quick check of LinkedIn shows that at least a dozen senior AMD employees joined Tesla in the first months of 2016. AMD shares were down 0.7%, near 13.65, during morning trading in the stock market today. Nvidia has delivered chips to current Tesla models with autopilot features, but Elon Musk has wanted to get more rule over the development of the chips.

Rosenblatt Securities Hans Mosesmann reiterates a Buy rating and $22 price target for AMD.

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