/ 20:29 IST Musk said he didn’t support a merger of the companies but wanted Tesla investors to get exposure to the growth at xAI The money behind Elon Musk’s trillion-dollar empire is increasingly flowing in one direction: toward artificial intelligence. The billionaire on Sunday said he plans to hold a vote by Tesla Inc. shareholders on whether the EV maker should invest in xAI, the cash-burning artificial intelligence startup he founded two years ago. That comes shortly after SpaceX, his mammoth rocket-launch company, agreed to invest about $2 billion into the AI firm, according to people familiar with the matter. Story continues below Advertisement Remove Ad While Tesla remains the most valuable automaker in the world, declining sales and a backlash to Musk’s work slashing the federal government in the Trump administration have sent shares down about 22% this year. The company’s stock An investment into xAI will “further dilute the declining EV business,” said Nancy Tengler, CEO and chief investment officer of Laffer Tengler Investments. Still, Tengler says any such investment is likely to be approved by Tesla shareholders, many of whom remain extremely loyal to Musk. Tengler says the 2016 all-stock deal to buy Solar City serves as a precedent, which was approved by shareholders despite some pushback, including lawsuits. “Shareholders will view it as a positive,” Tengler said. “I think xAI will continue to increase in valuation and an investment into the company will allow Tesla shareholders to participate.” Tesla has set Nov. 6 as the date of its next annual meeting, but has yet to release its proxy. Tesla; Musk; Robyn Denholm, the chair of Tesla’s board of directors; and Travis Axelrod, Tesla’s head of investor relations, did not respond to requests for comment. Musk’s companies have a long history of working with each other. Tesla sells its utility-scale Megapack batteries to xAI, which is expanding its “Colossus” data center in Memphis. From January 2024 through February of this year, xAI spent about $230 million on Megapacks, according to a Tesla filing. Musk and other executives have discussed building up vertically integrated AI infrastructure, according to a person familiar with the matter. To do that, xAI would need global distribution and fast connectivity at scale, which could be aided by Starlink, the constellation of more than 7,000 satellites in low-earth orbit operated by Musk’s SpaceX, this person said. They said Starlink could serve as the distribution backbone for xAI’s language models, which would make an investment in xAI a bet on a future mega-client. The Wall Street Journal earlier reported that SpaceX agreed to invest in xAI. Grok Integration