SpaceX may spend up to $119 billion on ‘Terafab’ chip factory in Texas
In Brief
10:23 AM PDT · May 6, 2026
SpaceX, Elon Musk’s space company that also houses his AI company, xAI, is considering spending $55 billion, at least initially, to build a semiconductor factory in Grimes County, Texas, according to a proposal on the county website.
The company estimates it may spend a total of $119 billion on the project, which would be a “multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility,” according to the filing.
Musk has previously outlined plans for the project, dubbed “Terafab,” that will also see Tesla contributing resources. The companies have roped chipmaking giant Intel into the effort, aiming to develop chips for AI servers, satellites, SpaceX’s proposed data center in space, as well as autonomous Tesla vehicles and robots.
The billionaire has said the manufacturing facility will, sometime in the future, manufacture enough chips to provide 1 Terawatt of power...
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