Topline
The General Services Administration signed an agreement to purchase Grok AI models from Elon Musk’s xAI, joining other AI companies in making deals with the government, less than a week after the world’s richest person was seen speaking with President Donald Trump for the first time after a public fallout.
xAI will offer their “Grok for Government” AI services to federal agencies for $0.42 per agency for 18 months, the company said in a news release with the GSA.
In a statement, Musk, who previously led Trump’s “Department of Government Efficiency” focused on cutting spending, said the technology would allow the government to “innovate faster and accomplish its mission more effectively than ever before.”
The company will also offer agencies training programs for workers and assistance to help “secure integration.”
The xAI deal is not particularly unique compared to other deals the GSA has signed with rival AI companies in recent weeks, as AI companies try to secure potentially long-term lucrative deals. OpenAI signed a deal with the GSA in August, agreeing to provide government agencies with a year of Chat GPT Enterprise for a $1 fee per agency. AI startup Anthropic agreed to a similar deal for their chatbot Claude, offering three branches of government with a year of service for a $1 fee per agency. Google later offered “Gemini for Government” for a $0.47 fee per agency through 2026. Earlier this week, the GSA also approved Meta’s open source Llama model for government use.
The agreement comes only days after Musk was seen speaking with Trump for the first time in months on Sunday, when the two briefly met during the memorial service for conservative activist Charlie Kirk. Musk was a crucial ally for Trump during his 2024 presidential campaign, and when Trump took office in January, he brought Musk along to head his controversial “Department of Government Efficiency,” but they clashed over the president’s “Big Beautiful Bill” spending package. Musk escalated the feud on X, the social media platform he purchased for $44 billion in 2022, implying in a June post that Trump’s name was included in undisclosed client files from the late disgraced financier Jeffrey Epstein.
The GSA, the massive government agency that provides support in the form of products, services and facilities for other government agencies, was one of several agencies hit by DOGE’s staffing cuts in the beginning of the year. DOGE cut the agency’s staff by 79% at its Washington, D.C. headquarters, the Associated Press reported, as well as 65% of portfolio managers and 35% of facilities managers. However, the GSA is now attempting to rehire many of the employees whose jobs were cut. About 400 employees of the GSA’s Public Building Service were asked to return to work, the Federal News Network reported on Monday, after their layoffs were rescinded.