AMD is making a self-driving AI processor for Tesla

It looks like AMD might have scored a seriously large contract through electric car maker Tesla Motors, with the companies collaborating on a new AI accelerator for self-driving cars.

Jim Keller, the legendary engineer in AMD's ranks is reportedly involved in the deal, along with 50 engineers at Tesla. Keller has been involved with Apple's A4 and A5 processors, the original Athlon 64 processors, and AMD's latest Zen architecture.

AMD has reportedly already sent Tesla early samples of the new semi-custom chip, with testing already underway. For Tesla, this is the firs ttime they've opted for a purpose built AI processor, which will be using both AMD and Tesla IP.

This deal is big for multiple reasons: Tesla currently secures all of its GPUs from NVIDIA for self-driving cars, which I'm sure this deal will change that. Second, is that Tesla is aiming for a 2019 release for its first fully autonomous vehicle. AMD's next-gen Navi GPU architecture arrives late-2018, but could be pushed into 2019.

AMD shares has risen 4.7% in after hours trading from the news, but it makes me question something even more: will Tesla increase its investment into AMD even more? This could be something that helps AMD better compete against NVIDIA in the GPU space, with the helping hands (or should I say bank accounts and deals on semi custom designs) of Tesla?

Watch this space.