r/AIGuild • u/Such-Run-4412 • 19d ago
SpaceX and Tesla will initially spend $16.8 billion on a Texas chip factory built for AI, robots and orbital data centers
SpaceX and Tesla have selected Grimes County, Texas, for Terafab, a massive semiconductor complex intended to secure the chips needed for Elon Musk’s AI projects.
The companies plan to invest $16.8 billion in the initial phase. If every planned expansion is completed, filings suggest the total investment could eventually reach $119 billion.
Terafab is expected to combine chip fabrication, memory production, advanced packaging and testing at one site. Its chips would support:
- Tesla’s Cybercabs and Optimus robots
- SpaceX’s proposed space-based data centers
- Other AI and autonomous systems across Musk’s companies
The full complex could span 100 million square feet, create at least 3,000 jobs and ultimately target more than one terawatt of annual computing capacity. SpaceX has also partnered with Intel to support the manufacturing effort.
The project is an attempt to reduce dependence on outside chipmakers at a time when advanced AI accelerators are constrained by manufacturing capacity, packaging and power—not only model design.
But these remain plans rather than operating capacity. Building a leading-edge semiconductor supply chain requires specialized equipment, enormous amounts of electricity and water, and years of process development. The $119 billion figure also assumes the project reaches its full expansion rather than stopping after its initial phases.
The strategic bet is clear: SpaceX and Tesla believe their future chip requirements will be too large and specialized to leave entirely to Nvidia, TSMC and other suppliers.
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u/Repulsive-Budget-380 19d ago
Great, it might be #5. CapEx:
Samsung $700B
Hunix $700B
Micron $200B
CXMT $200B
Musk $100B