Musk says Tesla and SpaceX, not TSMC, will run Terafab
Elon Musk said Wednesday that Tesla and SpaceX will build and run Terafab, their planned AI chip plant in Texas, and that Taiwan's TSMC could at most rent space there. That matters for Intel, whose CEO said the same day that it will stay on the project. The first phase carries a $16.8 billion commitment.
Elon Musk wants no confusion over who will run his giant chip plant. On Wednesday, he wrote on X that Tesla and SpaceX will build and operate Terafab, a planned AI chip factory complex in Texas. "Let there be ZERO doubt about that," he wrote, according to Quartz, citing Reuters.
Musk was answering a user who predicted that Taiwan's chipmaker TSMC would end up owning the plant. "Maybe TSMC subleases part of the Terafab if they want, but nothing more than that," Musk wrote.
The talk started on Oct. 2, when the industry newsletter Culpium reported that TSMC was exploring ways to help run Terafab, Automotive World reported. Musk replied the next day: "Just discussions, but something may come of it." A later Culpium report said Intel's work on the project had made little progress, and Intel shares fell.
Hours before Musk's post on Wednesday, Intel CEO Lip-Bu Tan told Bloomberg that Intel would stay involved. He gave no details. Musk's post helped Intel's stock win back some losses, Automotive World reported.
Intel signed on in April to design, make and package chips for the project. Terafab's chips are expected to use Intel's next-generation 14A process. But a SpaceX filing in May described the deal as a "general framework" with no binding commitments.
The project is still mostly on paper. Tesla and SpaceX picked Grimes County, about an hour from Houston, in August and committed $16.8 billion to a first phase. A pilot line would target 3,000 wafers a month, with chips coming from 2029. A wafer is a thin disk of silicon cut into many chips.
Building a chip plant is hard. Neither Tesla nor SpaceX has ever produced a wafer. TSMC's CEO, C.C. Wei, warned earlier this year: "It takes two to three years to build a new plant—no shortcut—and it takes another one or two years to ramp it up."
For Intel, Terafab matters a lot. Its chipmaking unit lost $10.32 billion in 2025, and Musk's demand could help its turnaround. TSMC and Intel did not respond to Reuters' requests for comment.
What we know: Musk says his companies will own and run Terafab, and Intel says it is staying.
What we don't: What Intel's role will be and whether TSMC joins at all.
Where outlets agree Quartz and Automotive World both report Musk's 'ZERO doubt' post saying Tesla and SpaceX will run Terafab, and Intel's CEO saying Intel will stay involved.
Where they differ Musk says his companies will run the plant, but Automotive World notes neither has made a wafer, and Intel has not said what its role will be.