Musk Says Tesla, SpaceX, xAI Chip Project to Kick Off in Texas

Elon Musk announced the launch of Terafab, a high-tech semiconductor manufacturing initiative, in Austin, Texas, with operations led jointly by Tesla and SpaceX. The project aims to produce custom chips for AI, robotics, and space-based data centers, consolidating Musk’s tech ventures under a unified hardware strategy. Construction begins in 2026, with long-term goals to reduce reliance on third-party suppliers like TSMC and Nvidia for critical computing components. Terafab’s focus includes advanced AI accelerators for xAI, autonomous vehicle processors for Tesla, and radiation-hardened chips for SpaceX’s orbital infrastructure. The Austin site leverages Texas’s growing semiconductor ecosystem, tax incentives, and proximity to Musk’s existing Gigafactory and Starship development facilities.