AI TRENDS | Elon Musk Tightens AI Focus as SpaceX Cuts Most Grok Imagine R&D Staff

SpaceX’s AI team has cut most of the research and development staff working on Grok Imagine, its image- and video-generation tool, people familiar with the matter said. According to Sina Finance, about 60 employees associated with Grok Imagine were laid off last week, leaving a small team to keep the product running. The tool remains usable, but its future is uncertain without a dedicated development team. People familiar with the matter said SpaceX shifted its priorities toward AI coding tools and Grok Bot agents after acquiring Musk’s AI company xAI in February in a stock deal valued at $250 billion. In August, SpaceX spent $60 billion to acquire AI coding startup Cursor as part of the shift. The move resembles OpenAI’s earlier change in direction. OpenAI shut down its Sora video-generation tool earlier this year because of high computing costs and refocused on enterprise business and AI coding applications. In March, Musk wrote on X that the next version of Grok Imagine would amaze people and that the company would invest more in it. Before the layoffs, Grok was one of the few U.S. projects still training video-generation models in-house; Google and Meta also have their own tools. An independent leaderboard ranked Grok Imagine Video 1.5, released in June, 17th for image-to-video generation and 16th for text-to-video generation. SpaceX’s IPO filing said the system generated more than 2 million videos per month on average in the quarter that included March. In July, Musk said Grok Imagine would produce a full-length AI film based on Homer’s Odyssey, promising historical accuracy and fidelity to the original style. A clip of the first seven minutes, released last month, drew negative reviews.