Elon Musk tells XAI employees: We can win the AI race by building a factory on the Moon
Elon Musk has told XAI employees that building a factory on the Moon could give the company the computing power it needs to win the AI race. He believes space-based infrastructure may be essential for training the next generation of artificial intelligence.
Elon Musk has presented one of his most ambitious ideas yet to the staff of xAI. He wants to build a factory on the Moon to power Artificial Intelligence (AI) in the future. During a recent internal meeting, Musk told employees that if xAI wants to stay ahead in the increasingly intense AI race, it will have to think beyond traditional data centers on Earth. In his view, the next leap in computing capability may need to come from space. Their proposal involves establishing a lunar manufacturing base that would produce AI-focused satellites and launch them into orbit using a powerful electromagnetic system known as a mass driver.
“You have to go to the moon,” Musk said during the discussion, making it clear that he sees space infrastructure as a competitive advantage in AI. According to him, placing more computing resources beyond Earth could give XAI access to levels of power that competitors may struggle to match.
This is not surprising because Musk’s long-held belief that technological progress depends on scale is not new. Training advanced AI models requires vast computing infrastructure, and companies across the region are racing to secure more chips, build larger facilities and attract top engineering talent. It appears that Musk believes that simply expanding Earth-based data centers may not be enough in the long run.
At the same meeting, he suggested that developed intelligence on that scale might be different from anything seen before. “It’s hard to imagine what an intelligence of that scale would think, but it would be incredibly exciting to see it happen,” he said.
Elon Musk isn’t kidding about building a factory on the moon
Moon’s proposal also fits into corporate restructuring. Only last week Musk had announced that xAI would merge with SpaceX. The move will help support plans for AI data centers in outer space, he said. The lunar factory concept now adds another layer to that vision, though Musk did not provide specifics about timelines, funding or construction methods.
Musk’s latest statement on the Moon is quite interesting because for years he had called colonization of Mars a central objective of SpaceX. Now, it appears he’s positioning Moon as a practical move. In its latest meeting with XAI staff, the NYT said they have outlined a long-term path that starts with establishing a self-sustaining presence on the Moon before moving on to Mars and eventually deep space exploration.
Inside XAI itself, Musk suggested that organizational adjustments are underway as the company scales. Rapid expansion often brings structural changes, and he indicated that the company is evolving to operate more effectively at a larger size. He stressed that speed remains the decisive factor in emerging technology markets. “If you’re moving faster than anyone else in any technology area, you’ll be a leader, and XAI is moving faster than any other company; no one is even close,” he said.
