Musk’s Grok AI Lands US Government Deal

Elon Musk’s artificial intelligence startup, xAI, has secured an agreement with the U.S. General Services Administration to make its Grok chatbot available to federal agencies, the government’s procurement arm announced.

xAI will commit engineers to assist in supporting agencies’ workflows with Grok products under the new agreement. This entails hands-on help instead of a generic vendor portal. The agreement will also provide participating agencies with an upgrade path to higher FedRAMP and Department of Defense Impact Levels to approve Grok for custom workloads, a clear security path for AI systems.

Musk, who left President Trump’s government after a 130-day tenure as a special government employee, weighed in, saying “xAI has the most powerful AI compute and most capable AI models in the world” and that this partnership will “empower the U.S. government to innovate faster and accomplish its mission more effectively than ever before.”

The turnaround

Two months ago, xAI was supposed to land a deal similar to GSA’s partnerships with competitors like OpenAI and Anthropic, but plans fell through after its chatbot espoused antisemitic and pro-Hitler content, according to early reports. A group of more than 30 advocacy organizations signed a letter to the Office of Management and Budget arguing the use of Grok goes against efforts to prevent “ideological bias” in AI models.

Then xAI flipped the script. A GSA official said the agency is “continuously monitoring and conducting safety benchmarks,” and has attempted to identify the root cause of safety issues with Grok models in response to the controversy. The deal’s completion signals the administration’s belief that xAI has addressed technical issues and delivered capabilities that outweigh earlier concerns, a turnaround few expected in government contracting.

Next steps

This partnership sets a new precedent for AI across federal operations. The GSA emphasized that the contract is designed to accelerate responsible AI use while standardizing pricing and avoiding duplicative procurement deals across the government through this morning’s announcement.

xAI cofounder Ross Nordeen mentioned that ‘Grok for Government’ will deliver transformational AI capabilities, underscoring a commitment to “making America a world leader in advanced AI use.”

xAI’s contract is currently the longest in duration and lowest in cost compared to deals with companies like OpenAI, Anthropic, Google, and Meta based on current government AI partnerships.

The next 18 months will show whether this government wide rollout actually changes how agencies operate.