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Tesla Versus OpenAI: Tech Hiring Wars

Last Updated April 5, 2024 12:58 PM
Giuseppe Ciccomascolo
Last Updated April 5, 2024 12:58 PM

Key Takeaways

  • Elon Musk acknowledges Tesla’s struggle to retain AI talent.
  • The multibillionaire accused OpenAI of “aggressively recruiting” Tesla engineers.
  • Compensation is a key consideration in this tech hiring battle.

Elon Musk has acknowledged that Tesla is facing challenges in retaining artificial intelligence (AI) specialists. According to the tech mogul, some employees are choosing to leave the carmaker to join OpenAI.

Musk openly criticized OpenAI for its ‘aggressive’ recruitment of Tesla engineers. This marks the latest development in his ongoing conflict with OpenAI which not only focuses on engineer hiring  activities.

OpenAI “Steals” Tesla Engineers

Tesla is ramping up compensation for its AI engineering team, linking it to performance milestones, as Musk announced  on X. Responding to a report  by The Information regarding xAI, his startup, poaching four engineers from Tesla, Musk attributed the situation to “the craziest talent war I’ve ever seen!”

The departure of personnel from Musk’s flagship company to his latest venture raises concerns about conflicts and governance within his empire. OpenAI is “aggressively recruiting” engineers from Tesla “with massive compensation offers,” Musk said. He added that the ChatGPT maker has “unfortunately been successful in a few cases.”

In January, Musk stated  he wanted to develop AI and robotics products elsewhere unless he was granted approximately 25% voting control at Tesla. Subsequently, a Delaware judge voided a substantial stock award arranged for him by Tesla’s board in 2018.

Amid this, the battle for AI talent intensifies. Musk asserted that Tesla’s Autopilot division, with over 200 engineers, is accelerating its autonomy innovations. However, the departure of the fourth engineer to one of Musk’s parallel ventures raises concerns among Tesla’s stakeholders. They worry about the movement of employees between Musk’s ventures, particularly as Tesla’s core automotive operations face a slowdown.

Despite these concerns, Musk’s actions may have a strategic angle. By framing xAI as a victim of talent poaching by industry leaders like OpenAI, Musk appears to position his new venture as a formidable competitor in the AI landscape.

It’s Also A Matter Of Compensation

In a thread  on X, Musk emphasized, “Tesla is increasing compensation (contingent on progress milestones) for our AI engineering team,” shedding light on the ongoing battle to recruit AI engineers, where compensation plays a pivotal role.

While the exact salary figures for AI engineers at Tesla or other Musk-affiliated companies remain unclear – estimates on the internet range  from $168,000 to $252,000 per year -, we know that OpenAI engineers earn above-average salaries in the industry. Their salaries range from $121,082 to $136,979 annually, with a median salary of $925,000. This includes base salary, stock compensation, and bonuses. This significantly surpasses the average salary for software engineers in the United States, which stands at $120,000 per year.

According to a Glassdoor report , the average annual salary for AI engineers in the United States is $120,000, with a wide range spanning from $80,000 to upwards of $200,000. Individuals with expertise in cutting-edge AI technologies such as deep learning or natural language processing can command even higher salaries.

Highest average annual salary of AI engineers in the US
Highest average annual salary of AI engineers in the US

For instance, Google DeepMind is known to offer salaries surpassing $300,000 per year to top AI researchers. In addition to base salary, AI engineers can expect additional perks such as stock options, bonuses, and relocation assistance. They also benefit from opportunities to collaborate on groundbreaking research projects alongside renowned AI experts.

Latest Episode Of Musk vs. OpenAI Saga

The ongoing saga of Musk versus OpenAI  saw the multibillionaire entrepreneur Musk file a lawsuit against OpenAI. Musk had been a co-founder of OpenAI in 2015 but resigned from his position in 2018. In the complaint, Musk criticized OpenAI, portraying it not as a non-profit organization aimed at advancing humanity’s progress, but rather as a conventional tech company driven primarily by profit motives. While this criticism may have merit, the lawsuit is based on the alleged violation of a contract that seemingly never existed.

The lawsuit was filed in the Superior Court of California in San Francisco, where OpenAI‘s registered office is situated. It marks the culmination of a protracted conflict between Musk, Greg Brockman, and Sam Altman, who respectively served as the startup’s CEO and president. Relations between Musk and the other two began to sour in 2017 when Musk sought to wrest control of OpenAI from Altman and the other founders, intending to transform it into a commercial venture in collaboration with Tesla.

Ultimately, Musk’s plan was thwarted by opposition from the other partners, leading to his resignation from the non-profit organization after a few months. He claimed to shift his focus to other projects related to Tesla’s artificial intelligence development.

Since then, Musk has not held back in his criticism of OpenAI, particularly following its partnership with Microsoft and its most advanced language model’s subsequent release of GPT-4.

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