The United States government is no longer just a regulator in the technology market; it is now a major business partner. After taking a massive stake in Intel, the Trump administration is working hard to fill the company’s order books. They are not just watching from the sidelines. Instead, they are using their political and financial influence to convince the world’s biggest tech leaders to manufacture their chips in America.
President Trump has reportedly become Intel’s most powerful salesman. During recent meetings, he shared stories of how the US government recorded tens of billions of dollars in profit as Intel’s stock price surged over the past few months. He used these massive financial gains to court Apple CEO Tim Cook, eventually convincing him to sign a contract with Intel. Now, the administration is focusing its pressure on Elon Musk and Tesla.
Reports from industry insiders suggest that the Trump administration is insisting that Tesla move its chip manufacturing. Specifically, they want Tesla to abandon its plans with the Taiwan Semiconductor Manufacturing Company (TSMC) and move the production of its AI6.5 chips to Intel’s factories in Arizona. This would be a massive shift from the strategy Elon Musk originally shared with the public.
Back in April, Musk laid out a clear plan for Tesla’s next generation of hardware. He intended to send the AI6 chip to Samsung’s 2-nanometer factory in Arizona. For the more powerful AI6.5 chip, he tapped TSMC to handle the work at its sprawling Arizona campus. The AI6 is scheduled for a “tape out”—the final stage of design before manufacturing—in December 2026, with the AI6.5 following just two months later.
These new chips represent a giant leap for Tesla’s self-driving ambitions. They are not just slightly better than the previous versions; they are designed to be twice as fast as the current AI5 hardware. Musk explained that both chips use a massive amount of SRAM memory. In fact, about 50% of the chip’s internal accelerators are dedicated to SRAM. This allows data to move much faster than standard DRAM. Both chips will also use the new LPDDR6 memory to help achieve that 2x performance jump.
The pressure to switch comes at a politically sensitive time. A source on the social media site Weibo claims that the Trump administration is insisting on the move because the US government is now Intel’s largest shareholder. By forcing giant companies like Apple and Tesla to use Intel, the administration can promote a return to American-made chips. This creates a strong talking point for the government heading into the November midterm elections.
However, moving production to Intel is a significant gamble for Tesla. For years, Musk has relied on TSMC as his main workhorse. TSMC has a proven track record of making chips that actually work without defects. Intel’s advanced manufacturing nodes are still largely untested for this kind of scale. Experts warn that Intel still struggles with residual yield issues, which means a high percentage of the chips they print might turn out to be unusable.
Tesla currently uses TSMC for the vast majority of its AI5 chip production, codenamed Helios. Samsung only serves as a backup option because TSMC’s most advanced factories are completely booked. If Musk follows the government’s “insistence” and moves to Intel, he is risking the future of Tesla’s self-driving software on a factory that has not yet proven it can deliver high-quality chips in large volumes.
Despite these risks, the Trump administration seems determined to make Intel a global leader again. President Trump has publicly stated that he “likes Intel” and views the government’s investment as a major success. The 14% surge in Intel’s stock price after the Apple news gave the administration even more confidence to push Tesla toward a similar agreement.
This situation shows how much politics now dictates the global technology market. The “American-made” push is about more than just manufacturing; it is about control and winning at the polls. If Intel can successfully build the brains for Apple’s phones and Tesla’s cars, it would be a historic win for the company. But if the manufacturing yields remain low, Tesla’s self-driving dreams could face a very expensive delay.
