tech
May 6, 2026
SpaceX may spend up to $119B on 'Terafab' chip factory in Texas
The project would be a "multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility," according to the proposal.
TL;DR
- SpaceX is considering spending $55 billion initially, up to $119 billion total, on a semiconductor factory in Grimes County, Texas.
- The project, codenamed 'Terafab,' is intended to be a 'multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility.'
- The initiative involves Tesla and chipmaker Intel, with the goal of developing chips for AI servers, satellites, SpaceX's proposed space data centers, Tesla's autonomous vehicles, and robots.
- Elon Musk cited the need for the factory because current semiconductor manufacturers are not producing chips fast enough for his companies' artificial intelligence and robotics requirements.
- Musk also stated that Grimes County, Texas, is one of several locations being considered for the factory.
- This move aligns with Musk's efforts to secure computing power for xAI's Grok AI models and his plans for space-based data centers.