Feb 1 (Reuters) - Cadence Design Systems on Thursday said it has designed a new artificial intelligence (AI) supercomputer system that can be used to simulate how air flows over jets and other gear as its competition with Ansys heats up.

Cadence is best know for its software that helps design computer chips, where the precise placement of tens of billions of tiny electrical switches called transistors can make or break a chip's speed and competitiveness.

But the San Jose, California-based company is competing with its primary rival Synopsys to weave chip design software together with apps used to design and test the larger mechanical systems that those chips become a part of.

Cadences makes physics simulation software that can test airflow and other fluid dynamics and competes against Ansys, which Synopsys last month moved to buy in a $35 billion deal after Ansys had initially drawn acquisition interest from Cadence.

Physics simulation software such as Cadence's requires such a huge amount of computing power that aircraft designers and other engineers rarely have enough time to test every aspect of their design and still meet business deadlines, said Frank Ham, vice president of research and development for computational fluid dynamics at Cadence.

The system Cadence introduced on Thursday, which it calls the Millennium M1, will help speed tests so that engineers can run more of them. It will also use AI to scour the huge amounts of data generated by those tests to recommend improvements that time-crunched engineers may have missed.

"There's no human that's reading all of the results of those simulations, and some of the design innovations that are buried in there are going be teased out," Ham said in an interview.

Cadence declined to comment on the cost of the system. It will both sell and rent the system depending on a customer's preferences and is available immediately. (Reporting by Stephen Nellis in San Francisco Editing by Bill Berkrot)