SpaceX and Tesla plan Terafab semiconductor mega-factory in Texas

SpaceX and Tesla are planning to construct Terafab, a massive semiconductor manufacturing facility in Grimes County, Texas. The project aims to create one of the world’s largest indoor structures, spanning approximately 9.3 million square meters (100 million square feet).

Designed to secure the hardware supply chain for artificial intelligence, autonomous vehicles, and orbital computing, Terafab intends to integrate the entire production process under one roof. This includes photolithography mask design, logic and memory chip fabrication, advanced packaging, and final testing. By controlling the full lifecycle, the companies aim to reduce dependence on external suppliers and mitigate current industry lead times.

Initial investment estimates for the project range between $14.5 billion and $16.8 billion, though total long-term costs could reach between $103 billion and $119 billion. The facility seeks to implement advanced manufacturing technologies, such as Intel’s 14A process, to revolutionize semiconductor production.