Musk Says Micron Gave Tesla ‘Significant’ Supply of Memory Chips

Elon Musk

Micron Technology Inc. recently gave Tesla Inc. a “significant allocation” of memory chips, according to Elon Musk, helping meet the automaker’s demand for an increasingly precious commodity.

At a time when memory chips are hard to come by and prices are high, Micron’s supply to Tesla was done on very reasonable terms, Musk said during the automaker’s quarterly earnings call on Wednesday.

The global build-out of artificial intelligence systems has fueled demand for memory chips, which help computers hold and manage data. The frenzy has created broader shortages that have rippled through other industries, driving up prices and straining manufacturing.

Over the longer run, Musk is working to produce his own semiconductors. The billionaire has initiated a long-shot program called Terafab that is meant to manufacture computing and memory chips at unprecedented scale. That effort is split jointly between Tesla and Space Exploration Technologies Corp., two companies where Musk serves as chief executive officer.

For now, Tesla needs Micron — and it doesn’t have the spending power of some other customers. Tesla and SpaceX aren’t in the list of top 10 clients for Micron, the largest US maker of memory chips, according to data compiled by Bloomberg.

Representatives for Micron didn’t respond to a request for comment.