Tesla, SpaceX to invest $20B in Texas Terafab chip plant
Tesla and SpaceX will jointly invest over $20B to build the Terafab semiconductor plant near Austin, Texas, aiming to produce advanced 2-nanometer chips for self-driving vehicles, humanoid robots, AI satellites and space data centers. The facility targets early production in 2027 with mass output by 2028 and terawatt-scale compute capacity.
1. Joint Investment and Facility Overview
Tesla and SpaceX have announced a joint project to build the Terafab semiconductor manufacturing facility near Austin, Texas, with an estimated investment exceeding $20 billion. The plant will consist of two factories—one dedicated to chips for Tesla vehicles and humanoid robots, and another for specialized space-grade chips.
2. Production Goals and Timeline
Terafab is designed to produce advanced 2-nanometer chips at scales up to 50 times current annual AI chip output by major suppliers. Early production is slated to begin in 2027, with full-scale operations and mass production targeted for 2028, aiming to deliver around one terawatt of compute capacity each year.
3. Strategic Implications for Tesla
Securing an in-house advanced chip supply addresses Tesla’s need for high-performance semiconductors in autonomous driving and robotics, reducing reliance on external suppliers. The space-grade chip line also supports SpaceX’s planned satellite and space data center expansions, reinforcing vertical integration across Musk’s companies.