Musk says Tesla, SpaceX, xAI chip project to kick off in Texas

Elon Musk said his Terafab project will be built in Austin and jointly run Musk, the chief executive officer of both companies, said he will start with an advanced technology fab in Austin. The fab will have all equipment necessary to make chips of any kind and test them. Musk said the semiconductor industry is moving too slow to keep up with the supply of chips the companies expect to need. He said the rate is much less than desired and that the companies will build the Terafab because they need the chips. The project would support a terawatt of computing power per year. Musk detailed plans for chips supporting 100 to 200 gigawatts a year on Earth and chips supporting a terawatt in space, but gave no timelines. The facility is expected to produce two types of chips. One will be optimized for edge and inference primarily for vehicles, robotaxis and Optimus humanoid robots. The other will be a high power chip designed for space use Musk made the announcement in a downtown Austin venue to an audience that included Texas Governor Greg Abbott. The project is planned near Tesla's existing Austin headquarters and gigafactory. SpaceX acquired xAI in February with the latter operating as a wholly owned subsidiary. Musk said he expects xAI to use the vast majority of the chips. Tesla has an agreement with a Samsung facility near Austin on upcoming chips. Musk said suppliers including Taiwan Semiconductor Manufacturing Co. and Micron Technology Inc. are not able to meet all the company's needs.