Elon Musk said on Sunday that SpaceX and Tesla (NASDAQ:TSLA) plan to construct two advanced semiconductor manufacturing plants at a large new facility in Austin, Texas — one focused on powering vehicles and humanoid robots, and another aimed at supplying artificial intelligence data centers operating in space.
The remarks came a day after Musk unveiled plans for “Terafab,” a major AI chip manufacturing complex to be built in Austin.
“Terafab will technically be two fabs, each making only one chip design,” Musk wrote in a post on X.
While Musk has previously indicated that Tesla would eventually need its own AI chip production facility, the participation of SpaceX had not been revealed before. SpaceX — which is preparing for a potential public listing that could value the company at roughly $1.75 trillion — recently merged with Musk’s artificial intelligence and social media venture xAI.
“We either build the Terafab or we don’t have the chips,” Musk said during a presentation at a facility in Austin on Saturday, noting that current global semiconductor production would cover only a small portion of the future requirements of his companies.
Musk did not provide a timeline for when the project might begin or be completed. The billionaire entrepreneur has often announced large-scale projects in the past, although several have faced delays or have yet to materialize.
He also expressed appreciation for current semiconductor suppliers — including Samsung, TSMC and Micron — but said demand from his businesses could eventually surpass the entire world’s chip production capacity.
According to Musk, the Terafab facility could ultimately produce around one terawatt of computing capacity annually. By comparison, the total computing capacity currently generated across the United States is about half a terawatt.
One of the chips will be designed for Tesla vehicles and the company’s Optimus humanoid robots, while the second will be developed specifically for AI satellites operating in orbit.
“We need a high powered chip designed for space that takes into account the harsher environment,” Musk said, adding that the chips would need to function at higher temperatures.