Samsung’s Jay Y. Lee, Tesla’s Elon Musk discuss tech alliance

Samsung Group leader Lee Jay-yong has met with Tesla Inc. Chief Executive Elon Musk to discuss a tech alliance between the two companies in a variety of areas, including automotive semiconductors, AI and displays.

The two business leaders met at Samsung Electronics Co.'s semiconductor research center in Silicon Valley, California on Wednesday, according to Samsung officials.

It marks their first private meeting, although they have already met at other events with leaders of other companies, Samsung said.

The Lee-Musk meeting was joined by executives from each side, including Kyung Kye-hyun, president and chief of Samsung’s device solutions division; Samsung’s foundry business chief Choi Si-young; Han Jin-man, head of Samsung Device Solutions Americas (DSA); and Samsung Display Co. CEO Choi Joo-sun.

From Tesla, Karn Budhiraj, vice president of Global Supply Management, Chief Technology Officer Andrew Baglino and other executives participated. 

The Samsung chairman, widely known in international business circles as Jay Y. Lee, and Musk discussed ways to strengthen their technology partnership, including jointly developing chips for fully autonomous vehicles, Samsung officials said.

AUTOMOTIVE SYSTEM CHIPS

Samsung, the world’s largest memory chip and smartphone maker, has been supplying third-generation auto chips for Tesla’s full self-driving (FSD) cars since 2019. The Korean chipmaker is also said to be supplying fourth-generation FSD chips for Tesla.

Samsung is competing with its bigger foundry rival, Taiwan Semiconductor Manufacturing Co. (TSMC), to win automotive chip supply deals from Tesla.

Samsung Foundry said in April it won a chip production order from Intel Corp.’s autonomous driving tech affiliate Mobileye Global Inc.

Under the deal, Samsung will provide Mobileye with semiconductors for advanced driver assistance systems (ADAS), key devices for self-driving cars.

Mobileye has so far secured such chips from TSMC.

According to two market trackers Strategy Analytics and Research and Markets, the global auto parts market is expected to grow to $700 billion by 2028 from an estimated $400 billion in 2024.

OTHER AREAS OF BUSINESS COOPERATION

Samsung officials said Lee and Musk also discussed ways to strengthen their business cooperation in other areas such as displays, future mobility and artificial intelligence.

In addition to Tesla, Musk is leading innovative businesses such as SpaceX, satellite communication service Starlink and future mobility project Hyperloop.

Tesla has been procuring LCD panels for its Model 3 electric cars from Samsung’s crosstown rival LG Display Co. since 2016.

Samsung Display supplies its organic light-emitting diode (OLED) panels to clients, including Audi, BMW and Hyundai Motor Co.

In April, Samsung signed an initial agreement to supply such panels to Ferrari S.p.A.

Lee returned home Friday from his 22-day trip to the US, during which he met with about 20 chief executives of major companies, including Nvidia Corp. CEO Jensen Huang and Microsoft Corp. CEO Satya Nadella.

His US trip coincided with South Korean President Yoon Suk Yeol’s first state visit to Washington.

Write to Ik-Hwan Kim at lovepen@hankyung.com

In-Soo Nam edited this article.