Tesla’s position as the world’s leading manufacturer of electric vehicles is currently
unchallenged, and the Elon Musk-owned company is keen to maintain this position for as long
as possible.
To do this, the innovative carmaker has entered into a partnership with one of the world's
biggest phone and electronics and electronics manufacturers, Samsung.
Join us as we read through the terms of this new partnership between Tesla and Samsung.
Why Is Tesla Partnering With A Mobile Phone Company?
What Does This Partnership Mean For Both Companies?
How Long Will It Last?
What Does It Mean For Tesla’s Competitors?
We’ll find out shortly.
Elon Musk launched an assault on the automobile industry when he formed Tesla in 2003.
At the time, the concept of mass-producing electric cars was hard to comprehend, and
it looked like combustion-engined vehicles would never expire.
Fast forward to the current times, the United States and European Union are desperate to
retire fossil fuel cars between 2030 and 2050.
Car manufacturers are scrambling to become pure-electric automakers.
Consumers are demanding more eco-friendly cars and less gasoline fuel vehicles.
Ultimately, Tesla and the world's Ozone layer are the better for it.
With an estimated valuation of nearly $900 million, Tesla is the world’s most valuable
automobile company.
In 2021, despite the semiconductor chip shortage triggered by COVID-19, Tesla delivered around
one million vehicles worldwide.
While GM motors, Ford, Chrysler, and other Tesla competitors were forced to delay their
production schedule many times.
For the year 2022, Tesla hopes to double its production output for last year, with reports
that the automaker aims to deliver two million vehicles.
This bold plan is however threatened by the chip shortage problem which is still very
much around.
Why Is Tesla Partnering With A Mobile Phone Company?
First of all, it is important to emphasize that Samsung is not just a mobile phone company.
In reality, the South Korean brand is a huge multinational electronics firm.
One of the very best in the business, by the way.
Amongst its offerings include mobile phones, household gadgets, and semiconductor chips,
which is virtually used in the production of all electronics.
The idea is to get Samsung to build next-generation chips that will be used to produce the latest
set of Tesla cars that will hit the streets in no time.
There are also widespread unconfirmed reports that this partnership could expand even further,
meaning we could see Samsung produce semiconductor chips for the proposed Tesla Pi mobile phones.
What Are The Details Of This Partnership?
After achieving tremendous success with producing electric cars, Tesla is looking to go one
step further by making these vehicles completely autonomous.
This is supposedly top of the automaker’s priorities which is why the deal with Samsung
is key.
To make self-driving cars, Tesla needs to make both the hardware and software systems
that power its cars more sophisticated.
That means the automaker would require more semiconductor chips.
So, as part of the partnership, Samsung will produce newly designed 5-nanometer chips which
will be integrated into the infotainment system and the latest Hardware 4 self-driving computer
that will be installed in Tesla’s incoming fully autonomous electric vehicles.
South Korean news platform, The Korea Economic Daily all but confirmed the deal in an article
published last year September.
“Tesla and Samsung’s foundry division have been working on the design and samples
of the chip from the start of this year.
Recently, Tesla decided to outsource the HW 4.0 self-driving chip to Samsung.
It’s virtually a done deal,” the local news platform wrote.
Multiple discussions between Tesla and Samsung have been held since the beginning of last
year, and according to Reuters, both companies have already exchanged prototypes.
These chips will be produced through a special chip making technological process known as
Extreme Ultraviolet (EUV) lithography.
The EUV method helps manufacturers to produce semiconductor chips that are smaller, faster,
and at least five times more powerful than chips made through the deep-ultraviolet process.
This is not even surprising because Tesla and its owner Elon Musk have been known to
constantly push the limits when it comes to the innovation of production components.
Another fact that explains why Tesla has decided to optimize its chips is the unfolding story
that suggests the company is looking to include more than 50,000 steam-powered video games
in Tesla’s infotainment system.
That's a no brainer actually.
More games would require more processing power which would, in turn, require more sophisticated
semiconductor chips.
“We're working through the general case of making Steam games work on a Tesla.”
Elon Musk confirmed on Twitter.
What Does This Partnership Mean For Both Companies?
Most times, when two companies with vast technological and infrastructural strength decide to collaborate,
the result is always positive.
We do not expect the partnership between Tesla and Samsung to turn out any different.
Thanks to this partnership, Tesla will most likely become immune to the chips shortage
crisis that has disrupted the production capacity of its competitors.
The American automaker would be able to meet the rising demands for its electric vehicles.
Consequently, the company's valuation will rise and maybe even surpass the $1 trillion
holy grail benchmark.
That wouldn't be the first time, though.
In October 2021, Tesla’s market value rose significantly to exceed $1 trillion.
For context, Google, Amazon, Microsoft, and Apple are the only other companies to have
achieved this feat.
Just as this video was being drafted, news filtered in that Tesla’s shares were up
by 7%, following reports that the electric carmaker is due to open a new factory in Germany.
Surely, good times are ahead for Tesla and its investors.
Samsung and its shareholders will undoubtedly benefit from the partnership too.
Reports suggest Samsung shares could rise by as much as 50% when the partnership is
officially announced.
Forbes is also predicting a rise in the company’s shares prices
Right before we tell you how long the bromance between Tesla and Samsung would last, if you've
made it this far, make sure to like and subscribe for more content like this.
How Long Will It Last?
Predicting the timeline of this partnership is a little difficult because these are two
companies that have a good working relationship that reportedly dates back to 2016.
Back then, multiple sources reported that Tesla and Samsung were holding talks regarding
a possible partnership for batteries.
Elon Musk denied it but left an open for a possible collaboration between both companies.
Some other news outlets claim that the South Korean electronics company made 14-nanometer
chips for Tesla, but we couldn't verify this.
However, Tesla signed a $436 million camera module deal with Samsung Electro-Mechanics
mid-last year.
As a result, Samsung will produce and deliver all the cameras that will be used in Tesla’s
highly revered Cybertrucks which is expected to enter production in the first quarter of
2023.
So far, over one million pre-orders have been received for the Cybertruck.
You get a sense that these multiple partnerships on different fronts will metamorphose into
a long term bond between Tesla and Samsung.
With that said, we’ll have to wait for the official announcement to get a hint of the
duration and the financial terms of this partnership.
What Does It Mean For Tesla’s Competitors?
Aside from the Taiwan Semiconductor Manufacturing Company, Samsung is the world’s largest
chip maker.
This means while other automobile manufacturers are struggling to source for semiconductor
chips, Tesla would have a steady supply, enough to sustain and quicken the production process
of Tesla cars.
This would further strengthen Tesla’s position as the world's biggest EV manufacturer.
Additionally, if this partnership goes through, it would completely crush the morale of GM
motors and other automobile companies who have ambitions of catching up with Tesla.
Share Your Thoughts On This Imminent Partnership With Us.
Do You Support It?
Be sure to check out this video over here, “SECRETS OF THE PRESIDENTIAL MOTORCADE REVEALED.”