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Tesla to spend $500M to bring its Dojo supercomputer project to Buffalo factory

Tesla will spend $500 million to build one of its so-called "Dojo" supercomputers at its Buffalo, New York factory, the state's governor Kathy Hochul said Friday during a news conference just days after CEO Elon Musk called the project a "long shot."

Tesla’s decision was "informed by New York’s reliable power supply, strong talent pipeline and availability of usable space for the project," according to Hochul's office.

Dojo, which was first announced at Tesla's "AI Day" event in 2021, is a supercomputer meant to help advance the company's still-unrealized goal of building a self-driving car. Tesla plans to use the supercomputer to process reams of video data that come off of its electric vehicles in order to train the AI that now powers its most advanced driver assistance software, which it calls Full Self-Driving Beta. Musk said last year that Tesla plans to spend "well over $1 billion" on Dojo.

Bringing the Dojo project to Buffalo is the latest shift in Tesla's priorities for the location, which has turned into something of a boondoggle for New York state. Once dubbed "Gigafactory 2," Tesla took over the factory from SolarCity when it acquired the troubled solar panel company in 2016. The state had already committed $750 million to the plant by that point. Tesla promised to make Solar Roof tiles there, but struggled to produce the product at scale. Its partner, Panasonic, pulled out of the plant in 2020, and Tesla pivoted to employing people who labeled training data for its less-advanced Autopilot software.

Musk said last April that he believed the Dojo supercomputer project was a "long shot bet" that could "pay off in a very, very big way… in the multi-hundred-billion-dollar level."

He reiterated the point this week on a call with analysts. "It's not, like, a sure thing at all, It's a high-risk, high-payoff program," he said. "We are scaling it up, and we have plans for Dojo 1.5, Dojo 2, Dojo 3, and whatnot. So, you know, I think it's got potential, but the kind of size enough high risk, high payoff."

While the $500 million investment received cheers during Hochul's press conference, Musk downplayed the figure in a social media post on X, noting the company would spend far more money on Nvidia hardware in 2024.

"The governor is correct that this is a Dojo Supercomputer, but $500M, while obviously a large sum of money, is only equivalent to a 10k H100 system from Nvidia," Musk wrote in the post on X. "Tesla will spend more than that on Nvidia hardware this year. The table stakes for being competitive in AI are at least several billion dollars per year at this point."