Tesla Reportedly Switching From NVIDIA To Intel Chips For Powering Car Infotainment Systems
Those big touchscreen displays inside Tesla's fleet of automobiles might be getting a brain transplant. At present, hardware from NVIDIA powers the information and entertainment experiences displayed on the large displays, but for how long remains to be seen—it is said that Tesla is planning a switch to Intel hardware on its Model 3 and new versions of its other electric vehicles.
If true, this would be another blow inflicted to NVIDIA from Tesla. It was reported last week that Tesla had begun working with Advanced Micro Devices (AMD) to develop custom artificial intelligence chips to replace NVIDIA's Tegra system-on-chips (SoCs) for its Autopilot system. There does not appear to be any bad blood between Tesla and NVIDIA. Instead, Tesla is motivated by wanting to use purpose-built processors built to its exact specifications and needs.
Image Source: Tesla
Today's automobiles are more sophisticated than ever, and Tesla is leading the charge with its push for autonomous driving and electric power. On the inside, Tesla has replaced the traditional dashboard filled with dials and buttons in favor of a giant touchscreen display, which acts as the command center for creature comforts, navigation, diagnostics, and everything else.
NVIDIA has done well for itself by serving the automotive category. The company's automotive division rose 19 percent year-over-year in the second quarter of its fiscal 2018 period, reaching $142 million. That is also nearly double from the $79 million it collected six quarters prior.
While losing Tesla as a customer would hurt NVIDIA's bottom line, the chip designer has not put all its eggs in a single basket. The company recently announced a deal with Toyota to power its self-driving cars with its Drive PX system, as well as both Volvo and Autoliv.
The switch to Intel is probably due to Tesla anticipating much greater demand for its Model 3 versus higher-priced luxury sedans. Intel is the world's largest chip maker and was likely able to give Tesla a better deal on volume shipments, though we're speculating here.
News of the switch to Intel does not seem to be exciting investors. Share prices for both Tesla and Intel are down by around half a percentage point since the opening bell, while NVIDIA's share price up 1 percent.
If true, this would be another blow inflicted to NVIDIA from Tesla. It was reported last week that Tesla had begun working with Advanced Micro Devices (AMD) to develop custom artificial intelligence chips to replace NVIDIA's Tegra system-on-chips (SoCs) for its Autopilot system. There does not appear to be any bad blood between Tesla and NVIDIA. Instead, Tesla is motivated by wanting to use purpose-built processors built to its exact specifications and needs.
Image Source: Tesla
Today's automobiles are more sophisticated than ever, and Tesla is leading the charge with its push for autonomous driving and electric power. On the inside, Tesla has replaced the traditional dashboard filled with dials and buttons in favor of a giant touchscreen display, which acts as the command center for creature comforts, navigation, diagnostics, and everything else.
NVIDIA has done well for itself by serving the automotive category. The company's automotive division rose 19 percent year-over-year in the second quarter of its fiscal 2018 period, reaching $142 million. That is also nearly double from the $79 million it collected six quarters prior.
While losing Tesla as a customer would hurt NVIDIA's bottom line, the chip designer has not put all its eggs in a single basket. The company recently announced a deal with Toyota to power its self-driving cars with its Drive PX system, as well as both Volvo and Autoliv.
The switch to Intel is probably due to Tesla anticipating much greater demand for its Model 3 versus higher-priced luxury sedans. Intel is the world's largest chip maker and was likely able to give Tesla a better deal on volume shipments, though we're speculating here.
News of the switch to Intel does not seem to be exciting investors. Share prices for both Tesla and Intel are down by around half a percentage point since the opening bell, while NVIDIA's share price up 1 percent.
