SpaceX bets big on Terafab chip complex

Elon Musk’s SpaceX is preparing to invest up to $119 billion in “Terafab,” a vast semiconductor manufacturing complex aimed at securing future AI chip supply.

According to reports Thursday by The New York Times and The Wall Street Journal, a public hearing notice filed in Grimes County, Texas, put the first phase of the Terafab project at a minimum of $55 billion.

Once additional construction and infrastructure expenses are included, the overall investment could rise to as much as $119 billion, or roughly 174.6 trillion won.

Even by semiconductor industry standards, the scale is extraordinary. Advanced chip fabrication facilities typically cost between $10 billion and $30 billion to build. Grimes County described the project as an investment that would “dramatically expand semiconductor manufacturing capacity in the United States.”

Terafab is a joint AI semiconductor initiative involving SpaceX, Tesla, xAI and Intel. The project reflects growing concern among major technology companies that relying solely on outside foundries may no longer be enough to meet surging demand for AI chips.

The companies plan to manufacture critical semiconductors in-house for products including Tesla’s humanoid robots and SpaceX’s planned space-based data center operations.

The initiative could also become a pivotal moment for Intel. Last month, the company formally joined the project and said it would apply its latest 14A process technology to large-scale chip design, production and advanced packaging for high-performance semiconductors.

The agreement marks the first major customer win for Intel’s 14A process node. Industry analysts say securing a high-profile partner such as Musk could provide a much-needed boost for Intel, whose foundry business has struggled to gain momentum against established rivals.

Musk highlighted the project’s scale in a March post on X, formerly Twitter, calling Terafab “the largest chip manufacturing project in history” to integrate logic semiconductors, memory chips and advanced packaging under one roof. SpaceX has also applied for property tax incentives tied to the project. A related public hearing is scheduled for June 3.


한채연 chaezip@donga.com