US steps up its bid for AI: Elon Musk's company xAI has received a $ 200 million defense contract

The US Department of Defense has signed a contract worth up to $ 200 million with the company xAI, founded by Elon Musk. This agreement marks a turning point in relations between Musk and the US federal government, especially amid recent political disagreements. The contract provides for the development and implementation of a new generation of artificial intelligence Grok 4 in the interests of national security and defense infrastructure.

xAI has introduced a specialized Grok for Government platform adapted for the needs of US government agencies. It is based on a modified version of Grok 4, capable of performing analytical and operational tasks in closed environments that require a high degree of confidentiality. The platform architecture allows you to scale solutions to meet the needs of various departments-from the Ministry of Defense to intelligence agencies.

The contract comes at a time when national security is increasingly dependent on private-sector technology solutions. Elon Musk, despite controversial statements about the authorities, remains a key figure in the high-tech infrastructure-from Starlink satellite Internet to SpaceX rockets and xAI machine intelligence. The latest project strengthens its position as a strategic contractor in critical areas.

A special context is given to the deal by the political tension between Musk and the presidential administration. In June 2025, Musk openly criticized one of the bills initiated by the White House, followed by a statement about the possible termination of all contracts concluded with his companies, including SpaceX, which received more than $ 38 billion under various federal programs. In response, Musk threatened to decommission the Dragon spacecraft, which play a key role in NASA missions, but later abandoned this step.

One of the reasons for the conflict was the cancellation of state subsidies for electric vehicles produced by Tesla. The president has publicly stated that Musk "has a lot more to lose" if he continues the standoff. However, the conclusion of the Grok for Government development contract indicates that both sides are ready for a pragmatic dialogue based on technological priorities and national security interests.

Taking into account the rapid development of artificial intelligence technologies and the growing geopolitical challenges, the involvement of private companies in defense tasks is becoming a new standard. xAI, despite its youth, is already included in the list of strategic solution providers - with direct access to funding, data, and closed infrastructures of the US government.