Tesla and SpaceX announce Terafab AI chip factory in Texas with $16.8 billion investment

Tesla and SpaceX jointly announced the construction of Terafab, an advanced AI chip manufacturing facility in Grimes County, Texas, with an initial investment of $16.8 billion. The project, led by CEO Elon Musk, aims to meet the future computational demands of both companies, which together will need over one petawatt of capacity—far exceeding the current global semiconductor market supply. The factory will integrate design, manufacturing, data storage, and advanced packaging of chips in a single facility, aiming to bring cutting-edge manufacturing back to the United States and create thousands of well-paying jobs in Texas.