Elon Musk announced plans for Terrafab, a semiconductor manufacturing facility in Texas, on October 11, 2026. The project is a collaboration among Tesla, SpaceX and Intel, with an initial investment projected to exceed $15 billion.
The facility is planned to cover approximately 1 million square feet. It would sit on a 3,000-acre site and is expected to create about 3,000 jobs. The Texas government has approved a $30 million grant to support the project.
The project would expand Musk’s companies’ efforts to produce their own chips, which are needed for their artificial intelligence and autonomous driving ambitions. The announcement positions Tesla to compete directly with established semiconductor manufacturers. The companies aim to develop chip production processes and secure a domestic supply chain for their advanced technology needs.