TLDRs;
- Elon Musk’s xAI secured a GSA deal to provide Grok 4 and Grok 4 Fast AI models until 2027.
- Federal agencies will pay just $0.42 per unit, making Grok cheaper than OpenAI’s ChatGPT government offering.
- xAI engineers will support implementation, and agencies can choose enterprise subscriptions meeting federal security standards.
- Musk praised the Trump administration, saying Grok will help agencies modernize and accelerate government innovation.
The U.S. General Services Administration (GSA) has awarded a contract to Elon Musk’s artificial intelligence company, xAI, to supply its Grok chatbot models to federal agencies.
The Wednesday agreement, part of the GSA’s OneGov initiative, ensures that agencies will be able to access the company’s Grok 4 and Grok 4 Fast models until March 2027.
The GSA emphasized the affordability of the arrangement, noting that organizations will pay $0.42 per unit, making Grok significantly cheaper than competing models. By comparison, OpenAI’s government-tailored ChatGPT costs $1 per unit annually, giving xAI a competitive edge in terms of cost-effectiveness.
Grok Models Aim to Modernize Federal Workflows
Under the agreement, xAI will provide engineering support to assist agencies in implementing Grok into their operations. Federal agencies can also subscribe to enterprise plans designed to meet national security and compliance standards.
The Grok chatbot, already integrated into Musk’s social media platform X , is positioned as a tool capable of advanced reasoning, natural language processing, and workflow automation.
According to Musk, Grok 4 and Grok 4 Fast represent “the most capable AI models available today,” designed to help the government accelerate modernization and boost operational efficiency.
Political Backdrop and Musk’s Statement
While the deal is largely a technological milestone, it also carries a political undertone. Elon Musk publicly praised the Trump administration for supporting the agreement.
“Thanks to President Trump and his administration, xAI’s frontier AI is now unlocked for every federal agency, empowering the U.S. government to innovate faster and accomplish its mission more effectively than ever before.” He said.
🚨NEW: Elon Musk has thanked President Trump and his administration for allowing xAI's Grok to be used across U.S. federal agencies. pic.twitter.com/8QuY4JGTMh
— DogeDesigner (@cb_doge) September 25, 2025
Though Musk and Trump’s political relationship has seen highs and lows, their alignment on the importance of AI innovation in government remains intact. Musk added that the collaboration aims to “rapidly deploy AI throughout the government for the benefit of the country.”
Competition Among AI Providers Intensifies
The U.S. government’s deal with xAI is part of a wider effort to diversify its AI partnerships and avoid dependence on a single provider.
Agencies already use Meta’s Llama models, Google’s Gemini and research tools, Anthropic’s Claude systems, and OpenAI’s ChatGPT for Government. This multi-vendor approach is designed to ensure choice, security, and innovation across federal operations.
Even so, xAI’s lower pricing and Elon Musk’s direct role make Grok a standout option that could see broad adoption through 2027.
adopted tools.
