SpaceX and Tesla confirmed on Thursday that Terafab, their joint semiconductor plant, will rise in Grimes County, an hour outside Houston. The two companies will put in $16.8bn to start. Future phases could push the total far higher. A May filing floated as much as $119bn.
The plant is meant to be vast. In its announcement, SpaceX described more than 100 million square feet of floor space, roughly the size of a small town. It will make, package, and test advanced logic and memory chips in one place. Musk calls it “the most epic chip-building effort” in the world.
Why build a fab at all
The reason is demand that no one else can meet. SpaceX and Tesla expect to need more than 1 terawatt of computing power in the coming years. That is far beyond what the world’s chipmakers can supply today. Rather than wait in line, Musk wants to make the chips himself.
The output has two homes. Musk says about a quarter will go to Tesla’s Optimus robots and Cybercabs. The other three quarters will power SpaceX’s space-based data centres, the orbital compute Musk has staked the company’s future on.
