SpaceX · Tesla · xAI (expected user)
Terafab: a vertically integrated AI-chip fab in Grimes County, Texas
Musk's plan to put logic, memory, advanced packaging, test and masks under one roof, so Tesla, SpaceX and xAI stop depending on outside foundries for AI chips. Unveiled in Austin in March 2026. Tesla runs a ~$3B research fab at Giga Texas, while SpaceX leads the scaled-up Grimes County complex, which broke ground in August 2026. Intel is the process partner. Phase 1 wafer capacity and the first-silicon date have not been disclosed.
No official site photos or renderings with a clear reuse license were found, so this page has no images.
Intel joined Apr 7; reaffirmed Oct 7
TechCrunchTom's Hardware via Yahoo FinanceTom's HardwareSpaceX expectation; tax incentives start 2029
Spectrum News 1ThePCEnthusiastScope: what Terafab is supposed to make
Musk claims vs. filed facts| What's under one roof | Logic · memory · packaging · test · masksClaim / target Tom's Hardware |
|---|---|
| Chip family 1 | Edge inferenceClaim / target For Tesla vehicles, Cybercab and Optimus Tom's HardwareSpaceX |
| Chip family 2 | High-power, space-hardenedClaim / target For orbital AI data centers Tom's HardwareSpaceX |
| Process node | Intel 14A (planned)Claim / target Musk on Apr 22: 14A 'not yet totally complete'. 2nm-class was cited at launch Tom's Hardware via Yahoo FinanceSiliconANGLE |
| Tesla research fab | ~$3B · Giga TexasClaim / target 'A few thousand wafers per month'; broke ground Apr 2026 Tom's Hardware via Yahoo Finance |
| Scaled fab | SpaceX-led · Grimes CountyConfirmed 'SpaceX is going to take care of the initial phase of the scaled-up Terafab' Tom's Hardware via Yahoo FinanceSpaceX |
| Location | Near Gibbons Creek ReservoirConfirmed Off Hwy 30, ~15–20 mi from Texas A&M Houston ChronicleKBTX |
| Expected users | Tesla · SpaceX · xAIReported Spectrum News 1 |
| Wafer starts (target) | 100k / mo → 1M / moClaim / target Musk's Nov 2025 goal; no Phase 1 figure published TechSpot |
| Does it make AI5 / AI6? | No (per current plans)Confirmed AI5/AI6 go to Samsung (Taylor) and TSMC; Terafab chips are unnamed Tom's HardwareSeoul Economic Daily |
Partners & suppliers
Who does whatProcess technology partner (14A). Joined Apr 7, 2026; CEO Lip-Bu Tan said on Oct 7 that Intel remains involved.
TechCrunchTom's HardwareMusk confirmed talks in late Sep. On Oct 7 he said TSMC will not run Terafab and might only sublease part of it.
CNATom's HardwareNot a Terafab partner. Its $16.5B deal (Jul 2025) covers AI6, and trial AI5 production at Taylor started Sep 2026.
ReutersSeoul Economic DailyMusk said Tesla will keep buying chips and memory from existing suppliers.
Tom's Hardware$30M Texas Enterprise Fund grant; $1.66B local tax abatement.
ConstructConnectKBTXClaims vs reality
Cost, timing, output, control| Item | Promised / target | Reality (Oct 7, 2026) | Status |
|---|---|---|---|
| Cost | ~$20B reported at launch (some outlets said $25B) Tom's HardwareSiliconANGLE | $16.8B initial phase; county filing shows $55B first phase and up to $119B full buildout ConstructConnectCNBC | Confirmed |
| Timeline | No timeline given at launch Tom's Hardware | Phase 1 construction 2026–2028; limited operations expected toward end-2027 ThePCEnthusiastSpectrum News 1 | Not yet |
| Who runs it | Musk: 'we will build and run the fab' CNA | SpaceX leads scaled phase; Intel supplies process tech; TSMC sublease floated only Tom's Hardware via Yahoo FinanceTom's Hardware | Claim / target |
| Output | 1 TW/yr of compute; 100k → 1M wafer starts/mo TechCrunchTechSpot | No wafer capacity disclosed for Phase 1; research fab: 'a few thousand wafers per month' Tom's Hardware via Yahoo Finance | Not yet |
| Node readiness | Leading-edge (2nm-class / Intel 14A) SiliconANGLETechCrunch | Intel 14A 'not yet totally complete' (Musk, Apr 2026) Tom's Hardware via Yahoo Finance | Not yet |
| Transparency | Public incentive process CNBC | SpaceX sued the Texas AG and Grimes County to withhold parts of its application file KBTX | Reported |
Target: ~$20B reported at launch (some outlets said $25B)
Tom's HardwareSiliconANGLEReality: $16.8B initial phase; county filing shows $55B first phase and up to $119B full buildout
ConstructConnectCNBCTarget: No timeline given at launch
Tom's HardwareReality: Phase 1 construction 2026–2028; limited operations expected toward end-2027
ThePCEnthusiastSpectrum News 1Target: Musk: 'we will build and run the fab'
CNAReality: SpaceX leads scaled phase; Intel supplies process tech; TSMC sublease floated only
Tom's Hardware via Yahoo FinanceTom's HardwareTarget: 1 TW/yr of compute; 100k → 1M wafer starts/mo
TechCrunchTechSpotReality: No wafer capacity disclosed for Phase 1; research fab: 'a few thousand wafers per month'
Tom's Hardware via Yahoo FinanceTarget: Leading-edge (2nm-class / Intel 14A)
SiliconANGLETechCrunchReality: Intel 14A 'not yet totally complete' (Musk, Apr 2026)
Tom's Hardware via Yahoo FinanceMilestone timeline
Oldest first- Nov 2025Terafab idea floatedClaim / target
At Tesla's annual meeting Musk talked of a fab starting at 100k wafer starts/month and scaling to 1M.
TechSpot - Mar 21, 2026Unveiled in AustinConfirmed
Livestream from Seaholm: logic, memory, packaging, test and masks in one place; ~$20B reported; no timeline.
Tom's HardwareSiliconANGLE - Apr 7, 2026Intel signs onConfirmed
Intel to help 'accelerate Terafab's aim to produce 1 TW/year of compute'.
TechCrunch - Apr 22, 2026Structure set on Q1 callConfirmed
~$3B Tesla research fab at Giga Texas (a few thousand wafers/mo); SpaceX takes the initial scaled phase; Intel 14A.
Tom's Hardware via Yahoo Finance - May 6, 2026Grimes County filingConfirmed
$55B first phase, up to $119B full buildout; hearing June 3.
CNBC - Aug 6, 2026Groundbreaking announcedConfirmed
SpaceX and Tesla commit ~$16.8B initial phase, >100M sq ft, ≥3,000 jobs; $30M state grant.
SpaceXConstructConnect - Sep 10, 2026Records lawsuitReported
SpaceX sued AG Paxton and Grimes County to block release of parts of its Terafab application file (the tax deal itself is public).
TeslaNorthKBTX - Sep 28–29, 2026Site clearing visibleReported
Burn piles and clearing along Hwy 30; footprint >1,700 football fields, more than 3 miles across.
Spectrum News 1KBTX - Oct 7, 2026'ZERO doubt' on TSMCConfirmed
Musk: Tesla/SpaceX will build and run the fab; TSMC could at most sublease. Intel says it is still involved.
CNATom's Hardware
Risks & open questions
Estimates went from ~$20B at launch to $55B for the first phase and up to $119B. UBS put Musk's initial 100k-wafer target at ~$30B.
Tom's HardwareCNBCTechSpotTerafab depends on Intel 14A, which Musk said in April was not yet complete.
Tom's Hardware via Yahoo FinanceSpaceX is funding the scaled phase. Deals between Musk companies need approval from both boards.
Tom's Hardware via Yahoo FinanceSpaceX is in court to withhold parts of its Terafab application file from public-records requests.
KBTXMusk on Terafab
Verbatim, with source“We either build the TeraFab, or we don't have the chips, and we need the chips, so we build the TeraFab.”
“Probably a hundred to two hundred gigawatts a year of terrestrial chips, and probably on the order of a terawatt of chips in space.”
“No, we will build and run the fab. Let there be ZERO doubt about that. Maybe TSMC subleases part of the Terafab if they want, but nothing more than that.”
“SpaceX is going to take care of the initial phase of the scaled-up Terafab.”
Latest news
Newest first- Oct 7, 2026Musk rules out TSMC running TerafabConfirmed
A sublease is possible; Intel reaffirms its 14A role.
CNATom's Hardware - Sep 29, 2026Transparency questions mountReported
$1.66B tax break; records requests; SpaceX lawsuit.
KBTX - Sep 28, 2026Plant 'takes shape' in Grimes CountyReported
SpaceX expects limited operations toward end-2027.
Spectrum News 1 - Sep 16, 2026Samsung trial-produces AI5 in TaylorReported
Tesla's next chips are still made outside Terafab.
Seoul Economic Daily
Not disclosed / unverified
Not filled in on purpose- Phase 1 wafer starts per month and the process node in the first production module
- First-silicon date. Only 'limited operations toward end of 2027' (SpaceX) and incentives starting in 2029
- Names or specs of Terafab-made chips (AI5/AI6 are made at Samsung/TSMC)
- How capex is split between SpaceX, Tesla and xAI
- Whether TSMC will sublease space (Musk floated it Oct 7)
Sources
18 references · open in new tab- 1.Breaking Ground on Terafab in Texas · SpaceX · Aug 6, 2026
- 2.SpaceX, Tesla Terafab chip plant near College Station: what to know · Houston Chronicle · Aug 7, 2026
- 3.SpaceX, Tesla set $16.8B initial investment for Texas Terafab · ConstructConnect · Aug 7, 2026
- 4.Musk outlines Tesla-SpaceX Terafab in Austin · TechSpot · Mar 23, 2026
- 5.Musk unveils $20 billion TeraFab — targets a terawatt of annual compute · Tom's Hardware · Mar 22, 2026
- 6.Musk announces Terafab to manufacture chips for space-based AI · SiliconANGLE · Mar 22, 2026
- 7.Intel signs on to Musk's Terafab chips project · TechCrunch · Apr 7, 2026
- 8.Terafab to use Intel 14A; Tesla pilot line, SpaceX volume (Q1 call) · Tom's Hardware via Yahoo Finance · Apr 22, 2026
- 9.Terafab could cost up to $119 billion, filing shows · CNBC · May 6, 2026
- 10.Terafab Phase 1 construction 2026–2028 · ThePCEnthusiast · Aug 11, 2026
- 11.Terafab semiconductor plant takes shape in Grimes County · Spectrum News 1 · Sep 28, 2026
- 12.Terafab site takes shape as Musk's companies face transparency questions · KBTX · Sep 29, 2026
- 13.SpaceX sues over Terafab application file, not the public tax deal · TeslaNorth · Sep 10, 2026
- 14.Musk says TSMC won't run Terafab AI chip complex · CNA (Reuters) · Oct 7, 2026
- 15.Musk rejects TSMC takeover of Terafab; Intel reaffirms 14A role · Tom's Hardware · Oct 7, 2026
- 16.Tesla-Samsung $16.5 billion chip supply deal · Reuters · Jul 28, 2025
- 17.Samsung starts trial production of Tesla AI chips in Texas · Seoul Economic Daily · Sep 16, 2026
- 18.Musk confirms AI5 and AI6 will be made at Samsung and TSMC · Tom's Hardware · 2025