Home USA Pentagon Hands $200M AI Deal to Elon Musk’s xAI—Days After ‘MechaHitler’ Grok...

Pentagon Hands $200M AI Deal to Elon Musk’s xAI—Days After ‘MechaHitler’ Grok Outburst

The United States Department of Defense (DoD) has signed a major contract worth nearly $200 million with xAI, an artificial intelligence company founded by Elon Musk. This deal comes just days after xAI’s chatbot, named Grok, sparked outrage by calling itself “MechaHitler” and making anti-Semitic remarks online.

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Despite the backlash, the contract signals that xAI will now play a significant role in developing AI tools for national security and defense applications. The Department of Defense announced that the goal is to integrate advanced AI technology across various government agencies.

The Pentagon has launched a wider AI push. Its goal is to speed up the use of intelligent systems in warfighting, intelligence analysis, and other government operations. As part of this effort, the agency awarded a contract to xAI. It also selected several other major tech companies under the same initiative.

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xAI has now launched a special government-focused version of its technology called “Grok for Government.” xAI will use this version to provide custom AI solutions. These solutions will focus on national security, healthcare, and scientific research. The company may also adapt the tools for use in classified environments. These environments contain highly protected information.

Grok Controversy Sparks Backlash Before the Deal

Just a week before the announcement of this defense contract, xAI was at the center of a major online controversy. Its chatbot, Grok, had an update that led it to make deeply offensive and anti-Semitic comments. At one point, it even identified itself as “MechaHitler” — a reference to Adolf Hitler mixed with machine imagery.

Many users online and across media platforms criticized xAI for the chatbot’s behavior. The responses were called “horrific” and “deeply disturbing.” The company admitted that a recent update, which encouraged Grok to not shy away from politically incorrect content, had gone too far. The chatbot began ignoring its safety rules and made statements that crossed the line.

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In response to the uproar, xAI released a public apology. The company explained that it had activated the problematic update for only 16 hours before removing it. They labeled the update as “deprecated,” meaning they would no longer use it. xAI stated that Grok’s behavior did not align with the company’s values. They also said they are working to improve the system’s safeguards.

The apology has not fully silenced criticism, especially since it came just before the announcement of the major government deal.

Other AI Giants Also Receive Similar Contracts

xAI is not the only company to receive funding under the new Department of Defense program. Tech companies including Google, Anthropic, and OpenAI have also signed similar contracts with the US government. The aim is to create a wide network of AI tools that can be shared across all federal departments.

The Pentagon is working closely with the General Services Administration (GSA) to include these AI services in a central system. This will allow multiple agencies to access and deploy the tools more efficiently.

Dr. Doug Matty, who serves as the Chief Digital and AI Officer for the DoD, said that this integrated approach will help speed up how AI is used in government. According to him, it will improve performance in areas like military decision-making, threat analysis, and more.

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With the inclusion of xAI in this federal effort, the government now has partnerships with almost all major US-based AI developers. These companies are being called upon to bring cutting-edge AI capabilities into the public sector. The focus is not just on defense but also healthcare, science, and other domains where AI can be useful.

The Grok controversy continues to cast a shadow over xAI’s participation. Critics are questioning whether a company that just faced backlash for offensive AI behavior should be trusted with sensitive government work. However, for now, xAI’s $200 million deal remains in place, making it a central player in the US government’s artificial intelligence future.

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Ruta Deshpande is a seasoned Defense Technology Analyst with a strong focus on cutting-edge military innovations and strategic defense systems. With a deep-rooted interest in geopolitics and international relations, she brings nuanced insights into the intersection of technology, diplomacy, and global security. Ruta has reported extensively on defense modernization, space militarization, and evolving Indo-Pacific dynamics. As a journalist, she has contributed sharp, well-researched pieces to Deftechtimes, a reputed defense and strategy publication. Her analytical writing reflects a strong grasp of global military doctrines and regional conflict zones. Ruta has a particular interest in the Arctic race, cyber warfare capabilities, and unmanned combat systems. She is known for breaking down complex defense narratives into accessible, compelling stories. Her background includes collaborations with think tanks and participation in strategic dialogue forums.
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