Although xAI, the artificial intelligence (AI) company led by Elon Musk, has spent months trying to introduce its own model “Grok” to the enterprise market, the effort is faltering as even internal employees are reportedly reluctant to use it.

In response, SpaceX, xAI’s parent company, is making an all-out push to narrow the technology gap by moving to acquire Cursor, a fast-growing AI coding specialist.

According to Bloomberg and other foreign media on the 23rd (local time), Cursor previously granted SpaceX the right to acquire the company for USD 60 billion (approximately KRW 88.71 trillion). Even if the acquisition falls through, Cursor will receive USD 10 billion in return for the collaboration.

SpaceX described the decision as “a strategic choice to develop the world’s best AI for coding and knowledge work.”

● Confidence in “the smartest AI” … but even employees reluctant to use Grok

Grok is a general-purpose AI chatbot based on real-time data from X (formerly Twitter), which Musk acquired. Musk has expressed confidence, calling Grok “the smartest AI on Earth,” but assessments indicate that in terms of actual performance it still lags behind competing models.

Some sources told Bloomberg that even some SpaceX developers are hesitant to adopt Grok for their work due to its lack of performance.

In particular, for coding tasks that require precision, the prevailing preference is reportedly for Anthropic’s “Claude” rather than Grok.

● Profitability needs to be proven before IPO … seeking a breakthrough with Cursor acquisition

SpaceX is preparing for an initial public offering (IPO) scheduled for June. Before then, SpaceX faces the task of demonstrating a meaningful ability to generate profit.

The xAI team has promoted Grok to major Wall Street financial institutions and government agencies as being useful for internal operations and performance evaluations, but its limited capabilities in coding and financial modeling have been an obstacle.

Some organizations, including the U.S. Department of Agriculture (USDA), are currently adopting Grok, but critics say this is far from sufficient to secure market dominance. By contrast, Cursor, which Musk is seeking to acquire, is seen as the fastest-growing AI startup, driving the recent “vibe coding” boom in the tech industry.

● Musk declares sweeping overhaul: “Rebuilding from the ground up”

xAI’s management is reportedly overseeing a revamp with the goal of achieving performance on par with “Claude.”

Musk has also acknowledged that Grok lags behind its rivals in specialized domains such as coding and has initiated a broad organizational shake-up. Around March, he stated on social media platform X that “xAI’s initial design was not perfect, so we are currently rebuilding from the ground up.”

In line with this, xAI last month recruited two senior engineers from Cursor and appointed Michael Nichols, a former key executive of the Starlink team, as president, intensifying efforts to secure top talent.

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