Samsung Electronics Chairman Lee Jae-yong met with Tesla CEO Elon Musk at the Korean tech giant’s chip complex in Silicon Valley on Wednesday to discuss ways to strengthen cooperation in future tech industries, according to industry sources on Sunday.

During the meeting, sources said the two business leaders agreed to continue exchanges for next-generation technology development, especially on chips for fully autonomous vehicles.

It was the first time the heads of the world’s largest memory chipmaker and the world’s largest electric vehicle maker held an in-person meeting. The high-profile meeting was also attended by Samsung’s top executives, including co-CEO Kyung Kye-hyun and foundry business chief Choi Si-young.

Samsung and Tesla have worked together on developing autonomous driving chips since 2019. With the latest meeting, industry observers are paying attention to whether it would give the Korean tech giant a leg up against rival Taiwan Semiconductor Manufacturing Co. The two are competing to win a major contract to produce next-generation chips for Tesla.

With the latest meeting, keen attention is focused on whether Samsung can secure more chip orders from Tesla. Currently, Samsung produces advanced autonomous-driving chips for Nvidia and Mobileye.

Samsung has recently bolstered its technology leadership in the foundry sector by introducing the 4-nanometer production process to grow its autonomous vehicle business. The company also looks to expand and find new partners in the autonomous vehicle sector, and increase the proportion of nonmobile sales in its foundry business by more than half by 2027.

According to market research firms Strategy Analytics and Research and Markets, the global automotive chip market is expected to grow to $400 billion in 2024 and $700 billion in 2028. As the auto sector continues its shift to electric and autonomous vehicles, the number and types of chips used are expected to diversify, the research firms said.

Lee, Samsung’s de facto leader, returned home Friday after a 22-day business trip to the US. It was his longest stay overseas since he took over the group’s management when his father, the late Chairman Lee Kun-hee, was hospitalized after a heart attack in May 2014.

Lee accompanied President Yoon Suk Yeol as part of a 122-person business delegation during his six-day state visit to the US last month. After the president’s state visit, Lee remained in the country to meet some 20 CEOs of global companies, including Google, Microsoft, Nvidia and Johnson & Johnson.

During the meetings, the Samsung chief shared Samsung’s mid- to long-term vision with global business leaders and explored ways they could cooperate to lead futuristic industries, a source with knowledge of the meetings said on condition of anonymity.

He also focused on strengthening Samsung’s global network for its future growth drivers centered on system chips, secondary batteries, sixth-generation network services, artificial intelligence and biotechnology, seeing the firm’s business ties with the US as a matter of survival.

"Samsung is faced with the challenge of cultivating new future growth drivers amid a downturn in the global ICT market. At a crossroads, Lee made an effort to use his global network to explore new business strategies and made a breakthrough," the source said.