SpaceX, Tesla to initially spend $16.8 billion on Terafab chip plant in Texas

TSLA•2026-08-06

Initial Terafab investment and plans

Aug. 6 (Reuters) - Elon Musk's SpaceX and Tesla will initially invest $16.8 billion to build Terafab, an advanced AI semiconductor complex in Grimes County, Texas, as the companies race to secure the chip capacity that the billionaire has called essential to their future.

The facility is intended at narrowing the gap between global chip supply and the more than 1 terawatt of computing power that SpaceX and Tesla expect to need in the coming years.

Future expansion phases could push total investment much higher, SpaceX said in a statement on its website on Thursday, adding that the facility would employ at least 3,000 people.

SpaceX, Tesla to initially spend $16.8 billion on Terafab chip plant in Texas

Initial Terafab investment and plans

Musk says the plant will support AI chips at scale

Earlier estimates, partnerships and Texas footprint

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