Elon Musk Pressured Trump Team To Include xAI In The OpenAI–Oracle Abu Dhabi Deal, Threatening To Block It Otherwise: Report

Elon Musk, the CEO of Tesla Inc. (NASDAQ:TSLA) and SpaceX, reportedly lobbied the Trump administration to include his AI startup, xAI, in a deal with Sam Altman‘s OpenAI to build a massive AI data center in Abu Dhabi.

What Happened: Musk reportedly used his influence to ensure that his company was a part of the deal, which was led by OpenAI and involved several American tech giants. The deal, which was approved by the Trump administration, is set to establish one of the world’s largest AI data centers in Abu Dhabi, according to a report by The Wall Street Journal.

Musk’s intervention came after he learned that OpenAI’s CEO, Sam Altman, was planning a deal in the U.A.E. during President Donald Trump‘s visit to the Gulf countries. Musk, who was reportedly unhappy about the deal, joined the trip and voiced his concerns to Trump and U.S. officials.

Musk reportedly warned executives at G42—an AI company overseen by the brother of the United Arab Emirates’ president—that their proposal would not receive President Trump’s approval unless his own company, xAI, was part of the arrangement.

Despite Musk’s objections, the deal went through, with the White House officials stating that Musk was concerned about the deal favoring Altman. The U.A.E. had been lobbying for AI chips and, after the Biden administration restricted chip sales, the U.A.E. turned to the Trump administration.

A senior White House official also confirmed that Musk had expressed concerns about the deal, emphasizing the importance of fairness for all AI companies.

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Why It Matters: This incident comes amid an ongoing legal battle between OpenAI and Musk. In a court filing, OpenAI accused Musk of fraud and media manipulation, urging a judge to allow its countersuit to proceed, as reported.

Earlier this month, OpenAI announced that it would retain its nonprofit parent’s control over its for-profit operations, reversing a previous plan to fully transition to a public benefit corporation. This decision was made amid increasing legal pressure and investor concerns.

WSJ reported that previously, Musk had reacted angrily to Trump's January U.S. Stargate deal with OpenAI, Oracle (NASDAQ:ORCL) and SoftBank, feeling blindsided by the $500 billion announcement. He questioned the backers’ financial capacity and publicly criticized the deal on X.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors

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