Elon Musk has announced that Tesla and SpaceX will build two advanced semiconductor factories in Austin as part of a new project dubbed "Terafab."
The plan involves two specialized facilities: one focused on chips for Tesla's electric vehicles and humanoid robots, and another designed for artificial intelligence systems, including future space-based data centers.
Musk said current global chip production would only cover about 3% of the future needs of his companies, highlighting the scale of demand driven by AI and robotics. The project will also involve xAI, Musk's AI venture.
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The announcement underscores a shift toward vertical integration, with Musk aiming to reduce reliance on suppliers such as Samsung Electronics, TSMC and Micron Technology.
According to Musk, the facilities could eventually produce up to one terawatt of computing capacity annually, roughly double the current output across the United States. One of the chips will power Tesla's Optimus robots, while the other is being designed to operate in the harsher conditions of space.
No timeline for construction or production has been confirmed, and Musk's ambitious projects have historically faced delays, leaving uncertainty over when Terafab might become operational.