Elon Musk Announces $10B Terafab Chip Facility in Austin for Tesla, SpaceX, xAI

Elon Musk announced plans to build a semiconductor fabrication facility in Austin, Texas, called Terafab. The plant will produce custom chips for Tesla, SpaceX, and xAI, with an estimated cost of $10 billion. Construction is expected to begin later this year. The facility would reduce Musk's companies' dependence on external chip suppliers and give xAI dedicated hardware capacity for training and inference workloads. Musk described the project as necessary to secure long-term compute supply across his portfolio of companies.