Musk unveils joint Tesla-xAI project

• Reuters

• Published On Mar 12, 2026 at 07:53 AM IST

The project comes amid rising interest in agentic AI tools such as Anthropic’s Claude Cowork and follows Tesla’s $2 billion investment in xAI earlier this year.

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Elon Musk on Wednesday unveiled a joint project between Tesla and his artificial intelligence startup xAI, which he called “Macrohard” or “Digital Optimus” and said that it was a system capable of emulating the functions of software companies. In a post on his social media platform X, ‌Musk said ⁠the project ⁠pairs xAI’s Grok large language model, acting as a high-level “navigator,” with a Tesla-developed AI agent that processes real-time computer screen video and keyboard and mouse actions. The launch of Anthropic’s Claude Cowork, which can perform a range of computer-based tasks autonomously, has already spooked software investors who fear that agentic AI can disrupt established ⁠business models. Musk’s ‌xAI was previously building Macrohard as an AI project that would allow developers to simulate software creations ⁠by companies like Microsoft.

“In principle, it is capable of emulating the function of entire companies. That is why the program is called MACROHARD, a funny reference to Microsoft,” Musk said on Wednesday.

Musk said the system would run on Tesla’s in-house AI4 chip paired with xAI’s Nvidia-based server hardware, describing the combination as cost-competitive.

The announcement comes ‌after Tesla entered into an agreement in January to invest about $2 billion to acquire shares in xAI.

SpaceX acquired xAI last month ⁠in an all-stock deal that valued the rocket maker at $1 trillion and xAI at $250 billion, coming ahead of a potential blockbuster initial public offering for SpaceX later this year, with Musk citing orbital data centers as a main reason for the merger.

Records from the US Patent and Trademark Office show that xAI filed a trademark application for “Macrohard” in August 2025.