Tesla pumps $2 billion into xAI – Jalopnik

Happy Thursday! It’s January 29, 2026 and this is The Morning Shift: your daily digest of the most important car news from around the world, in one place. Here are the top stories shaping the way Americans drive and get around.

In this morning’s edition, we look at Elon Musk financing one company with another, and the impending departure of the Hyundai Santa Cruz from this mortal coil. We’ll also look at Hyundai’s latest major recall and Toyota’s good year last year.

Tesla said Wednesday it will invest $2 billion in CEO Elon Musk’s artificial intelligence company xAI, and that production plans for its Cybercab robotaxi are on track for this year.

The news bolstered Musk’s plan to transform Tesla from an electric vehicle maker into an AI company, which is key to the company’s roughly $1.5 trillion valuation, while reassurance on production plans is key to investor confidence as Tesla has repeatedly failed to deliver on Musk’s promises.

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Tesla is “entering a transition phase” in which it asks investors to underwrite potential revenue from self-driving software in its car and robotaxi businesses before auto sales recover, said Thomas Monteiro, senior analyst at Investing.com.

“(That) makes rollout metrics – and not deliveries – the most important leading indicator from here on out,” Monteiro said.

Musk, who has made some inaccurate predictions about robotaxi rollouts, said he expected to have fully autonomous vehicles in a quarter to a half of the United States by the end of this year.

Just in case funding Elon Musk’s political whims wasn’t a good reason not to buy a Tesla, you can now say that the money spent on Tesla cars or charging goes straight to funding Grok’s generation of CSAM on Twitter.

Hyundai plans to drop the Santa Cruz compact pickup after one generation and replace it with a larger model designed to have broader appeal, sources with knowledge of the matter told Automotive News.

Originally scheduled to continue until the second quarter of 2027, production in Santa Cruz is now expected to end earlier, a person briefed on the plan said.

Another source confirmed the phase-out, caused by weak sales and increased inventories. Its only similarly sized competitor, the Ford Maverick, outsold it 6-to-1 in 2025, leaving Hyundai dealers with nearly five months of inventory at the end of the year.

If I had the choice, I would personally go with Maverick over Santa Cruz. I just like the look better! I understand why the Hyundai has had a hard time keeping up with sales.

Hyundai Motor is recalling 568,576 Palisade Sports Utility Vehicles in the U.S. due to improper deployment of side curtain airbags, the National Highway Traffic Safety Administration (NHTSA) said Thursday.

NHTSA said the side curtain airbags for third-row occupants in these SUVs may not deploy properly in a crash, adding that the fix is ​​currently under development.

If the remedy is ‘in development’, this may be a recall that you can wait for. Just don’t put anyone in the third row of your car until a repair is done.

Toyota posted record sales of 11.3 million cars in 2025, boosted by strong U.S. demand and rising demand for hybrids to maintain its global sales crown despite U.S. tariffs.

Total sales of Toyota Motor Corp. rose 4.6 percent, extending its competitive lead this calendar year, including deliveries from its subsidiaries Daihatsu minicars and Hino truck manufacturers.

The key US market emerged as Toyota’s sales hero, along with popular hybrid vehicles. This combination helped the company weather the difficult business environment pressured by U.S. tariffs, renewed semiconductor shortages and deteriorating consumer confidence amid soaring sticker prices.

Toyota builds a lot of cars in the US, but not nearly as many as it actually sells. The company sold Volkswagen worldwide in 2025, making it the best-selling car brand of the year.

I even referenced this movie in a blog post I wrote yesterday!