Elon Musk’s xAI to build multi-billion-dollar supercomputer project in Memphis
MEMPHIS, Tenn. (WMC) – Elon Musk wants to build a multi-billion-dollar project in Memphis.
xAI will build the world’s largest supercomputer in the Bluff City, according to President and CEO of Greater Memphis Chamber Ted Townsend, who made the announcement during a press conference Wednesday.
“I am pleased to announce that xAI’s Gigafactory of Compute, the world’s largest supercomputer, is to be located in Memphis Tennessee,” he proclaimed.
Cheers could be heard from the crowd following the news that Memphis will be a pillar in the city for yet another major company.
“I’ve been waiting for this moment,” said Townsend.
xAI is a new artificial intelligence (AI) start-up company led by Elon Musk, who also heads Tesla and SpaceX. On xAI’s website, the company states it is working on “building artificial intelligence to accelerate human scientific discovery.”
Townsend said this is single-handedly the largest multi-billion-dollar capital investment by a new-to-market company in Memphis’ history.
“In less than 90 days, the chamber’s economic development team moved at lightning speed to ensure that Memphis would be in the position to be selected by xAI,” said Townsend. “It takes data, scientists, computational engineers, and a top creative talent in the artificial intelligence space.”
Townsend said xAI’s Gigafactory of Compute will open sometime this year but due to “global security concerns,” he cannot confirm where this facility will be located. According to the Memphis Business Journal’s sources, it will be located at the former Electrolux facility at 3231 Paul R. Lowry Road in Southwest Memphis.
“I am not at liberty to identify the location due to global security concerns,” said Townsend. However, during his speech Wednesday, Townsend mentioned Phoenix Investors, which owns five properties in Memphis, including the old Electrolux building.
Despite the major investment, MBJ’s sources claim the number of jobs coming to the area would only number in the low to mid-hundreds.
“Memphis is a city of innovators, so it’s no surprise that it feels like home to those looking to change the world,” said Memphis Mayor Paul Young. “We get things done here. We have great partners at the Greater Memphis Chamber and MLGW who were ready to make this happen. We had an ideal site, ripe for investment. And we had the power of our people who created new and innovative processes to keep up with the pace required to land this transformational project.”
But what exactly is a supercomputer, and how would it be used?
“To fuel and fund the AI space for all of his [Musk’s] companies first, obviously with Tesla and SpaceX,” Townsend explained. “If you can imagine the computational power necessary to place humans on the surface of Mars, that is going to happen here in Memphis.”
To learn more about what a supercomputer is and its capabilities, Action News 5 spoke with Dr. William Gropp, the director of the National Center for Supercomputing Applications at the University of Illionis Urbana-Champaign.
“They [supercomputers] really are a universal instrument that can be used for almost anything,” said Dr. Gropp. “Supercomputers are built from the same computers that you find on your laptops or your phone… there’s just lots of them.”
Memphians hope it brings more eyes and opportunities to their community.
“Memphis needs to be the hub in the region for technology, and if Elon Musk is bringing that here it’s going to create jobs,” said Brodrick Stigall. “It’s going to create tech jobs. And it might create partnerships with the different schools. The University of Memphis, Rhodes College, Christian Brothers where they could utilize that supercomputer.”
Some hope Musk will reinvest in a city that could be home to his generative AI brainchild.
“I would really love to see, instead of you [Musk] coming into this place and profiting off the fact that it is easy to make money here, I would love to see him invest in the community as well. If you’re going to profit off the community, reinvest in the community as well,” said Syd McKissack.
Others are skeptical after recent Tesla layoffs and after the Development Authority of Fulton County in Atlanta offered Musk a major tax break earlier this year to the tune of about $10 million.
Sarah Houston, executive director of Protect our Aquifer, claims xAI’s Gigafactory of Compute needs 1 million gallons of aquifer water per day to run.
She said if it’s built at the former Electrolux, the facility would need to commit to using upcycled wastewater from the city’s water plant nearby. Otherwise, that added pumping may put a strain on the shallow Davis Wellfield.
The Economic Development Growth Engine for Memphis and Shelby County, Tennessee Valley Authority, and other governing bodies will have the final say if xAI comes to Memphis and whether or not tax breaks could be part of that deal.
Musk announced the formation of xAi in July of last year and released its artificial intelligence chatbot called “Grok” in November.
Earlier this year, xAI reported that investors contributed $6 billion to develop the company’s artificial intelligence.
The funding should help Musk’s company compete in a race to develop artificial intelligence against Microsoft and Open AI, which created ChatGPT.
“Our chamber is built for this,” said Townsend. “In less than three weeks, the chamber’s economic development team demonstrated remarkable coordination, swiftly providing solutions and rallying partners faster than any other community. From the initial three weeks until today, Memphis emerged as a global nexus where velocity meets potency, which are attractive attributes to the xAI team.”
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