SpaceX plans Terafab semiconductor megafactory in Texas

SpaceX is advancing plans for Terafab, a massive vertically integrated semiconductor fabrication facility located in Grimes County, Texas. The project, which involves partnerships with Tesla and Intel, aims to produce advanced AI and computing chips to supply Musk’s various enterprises, including Tesla’s Optimus robots, Cybercab vehicles, and SpaceX’s Starlink satellites.

Total investment for the project could potentially reach $119 billion across multiple phases. The first phase involves a commitment of approximately $16.8 billion. The facility is expected to span over 100 million square feet and is projected to generate more than 1 terawatt of annual AI compute capacity while creating up to 3,000 permanent jobs.

In addition to the existing partnership with Intel, Elon Musk has confirmed via X that discussions are underway with TSMC regarding the project. This potential involvement of TSMC suggests a possible dual-sourcing strategy to mitigate risk and enhance the project’s manufacturing capabilities.