The Zhitong Finance App learned that Elon Musk said that his business empire will independently build and operate Terafab, shattering speculations that industry leader TSMC will take over the operation of its ambitious chip manufacturing project.
The Terafab project, located in Texas, is Musk's effort to enter the chip manufacturing business to serve his Tesla (TSLA.US) and SpaceXAI. Although Musk recently said he is in talks with TSMC, the trillionaire clarified in a post on the X platform on Wednesday that the only thing being considered is that TSMC may rent part of the planned site without involving any operating role.
“Maybe TSMC could sublease part of Terafab if it wanted to, but that's all,” Musk said in response to a video posted on his social networks. TSMC did not immediately respond to emails seeking comment.
US chipmaker Intel is helping Musk's companies develop technology to be used within Terafab. The plant is expected to supply advanced semiconductors to the needs of Musk's commercial empire, cover Tesla's car building and robotics businesses, and SpaceXAI, a merger that integrates space technology and the development team of Grok's xAI team. On Wednesday, he emphasized that his company will “build and operate this factory.”
TSMC is considering building a huge new chip manufacturing park in Texas. The company's key customers include American giants Nvidia and Apple, and is currently expanding its production facilities in the US.
If a decision is made to expand in Texas, it will further strengthen the state's growing chip manufacturing expertise and production capacity base — the state already has Samsung Electronics building a local factory, in addition to the Terafab project.