Total Mess at Elon Musk’s xAI, “Not Built Right” and “Being Rebuilt” — While Polluting Enormously

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Everything is wonderful and perfect and industry leading at Elon Musk companies … until it is not. We’ve seen it time and time again at Tesla, where we find out about insanely stupid decisions and distractions long after the company scrambled to fix them and went down a new route. Before Tesla made a profit in Q3 2019, when it was struggling to get the Model 3 to mass production, Elon Musk sparred with critics on Twitter and elsewhere, but he admitted long afterward that they had burned so much cash in that struggle, including missteps trying to automate too much, that they were within two weeks of running out of money. It was basically some gallant last-minute efforts from Jerome Guillen and his team that finally got the Model 3 to mass production “under a tent” and saved the company.

Tesla Full Self Driving was on the verge of being robotaxi ready, and then it was determined the approach was completely wrong and they had to rewrite the code and the approach almost from scratch. And then that basically happened again. Actually, it’s unclear how many times that has happened, but Tesla is nearly a decade behind on its robotaxi plans and continues to massively miss targets. (Tesla Robotaxis were supposed to be covering about 50% of the US population by the end of 2025.)

On To xAI

Elon Musk’s AI company xAI, built in part by Tesla employees, just recently merged with SpaceX with all kinds of promises and hype — and, surely, an incomprehensible valuation. Now that it’s been saved in what was hyped as a brilliant, synergistic merger, Elon Musk is admitting that xAI has huge, fundamental problems that mean it needs to be rebuilt from the core.

“xAI was not built right first time around, so is being rebuilt from the foundations up,” Elon Musk posted on his antisocial media site on Thursday. “Same thing happened with Tesla.” This was in response to someone else posting “Fractional Cursor acquisition. xAI taking the right steps.”

As is common on so many thread on X now, people respond with questions to Grok, xAI’s AI chatbot, to try to find out what a post means. When someone asked “what is Elon talking about?” in response to his post above, Grok responded: “Elon means xAI’s original setup and structure weren’t optimal for the scale we’re aiming for (understanding the universe, powering advanced AI like for robots and beyond). So the team is now rebuilding everything from the foundations up—team, processes, integrations with Tesla/SpaceX—just like Tesla did early on with design iterations, production pivots, and near-restarts to nail the core before exploding in growth. It’s classic first-principles reset for bigger success.”

Sounds exciting, eh? So, I guess … all that hype about how great xAI is over the past couple of years was … nonsense? It was all just BS? xAI is actually built so horribly that it needs to be rebuilt from the ground up? Apparently, Grok’s concerted pivot to porn wasn’t enough.

Time to Hire New People!

Tesla just got approval from the US government to convert shares in xAI to shares in SpaceX. However, after about half of xAI’s founding members left the company recently, Musk is on the hunt for new talent. In fact, they’re digging into old applications — that’s the stage they’re at.

“Many talented people over the past few years were declined an offer or even an interview,” Musk posted. “My apologies. [xAI’s head of talent, Baris Akis] and I are going through the company interview history and reaching back out to promising candidates.”

So, not only do they have to start over in their approach, but they also need a huge influx of new people. I’m sure that was all taken into account while determining the company’s valuation before it was basically acquired by SpaceX, right?

Popular YouTuber Zack “Jerry Rig Everything” Nelson responded, “It’s that bad eh.”

xAI on a Pollution Mission

While Tesla decided, for some reason, to invest in xAI, the startup has not at all been aligned with Tesla’s mission to accelerate the transition to clean, sustainable energy. In fact, it has been using highly polluting fossil fuel power plants despite the protests and pushback of people not wanting to be polluted by them. Naturally, it deep red states, who cares of humans suffer and die if it means making another billion dollars for a tech titan? “Mississippi regulators authorized xAI to build a power plant with 41 natural gas-burning turbines in Southaven to power its nearby data centers,” CNBC also reported last week. “The company, now part of SpaceX, obtained permits to build the plant despite residents’ concerns about noise and air pollution.” You may recall that when Tesla built its first “Gigafactory” in Nevada, it decided to not even include natural gas hookups, to not be tempted to use the climate-destroying fuel. That must have been someone else’s idea…. (Ahem, JB Straubel, ahem.)

“We are outraged that, despite the community’s clear demand to move the Election Day hearing, MDEQ chose to bulldoze through a decision that silenced the very residents most harmed by it,” Abre’ Conner, director of environmental and climate justice at NAACP, responded.

“The permit issued by MDEQ has a number of serious flaws that violate federal law, run afoul of the agency’s own policies, and put families in North Mississippi and Memphis at risk,” the NAACP and the Southern Environmental Law Center added.

Keep in mind that Grok, apparently not done right from the ground up and powered by dozens of highly polluting fossil fueled power plants, is now in all Tesla cars with an AMD Ryzen processor and vehicle software version 2025.26 or later. Tesla made the decision to add it to the Tesla infotainment system last year — starting on July 12, 2025. Anyone with a Tesla with this hardware, whether they wanted it or not, now have xAI’s Grok chatbot in their vehicle. Despite Tesla’s original mission, I have never seen Elon Musk say that xAI would be solar powered (despite Tesla having a whole solar power division that needs more business) or that it would help accelerate the world’s transition to clean, sustainable energy. Musk seems to be driven by other missions now.