Tesla and SpaceX’s Terafab: $16.8B Chip Factory | byteiota

Tesla and SpaceX officially broke ground on Terafab on August 6, 2026 — a $16.8 billion semiconductor megafactory in Grimes County, Texas, built to supply chips for Optimus robots, Cybercabs, and SpaceX’s planned orbital data centers.

SpaceX to build on-site natural gas plant for $55b Texas semiconductor site

Driven by Musk’s vision of a ... AI data centers, the Terafab project aims to fill a massive computing shortfall that current global chip production cannot support. It will mass-produce custom artificial intelligence chips engineered to power ...

SpaceX’s Texas Terafab Could Become World’s Largest Building

Tesla has also expanded aggressively in the state, moving its headquarters to Austin in 2021 and continuing to grow its Gigafactory campus, which is expected to exceed 15 million square feet by the end of 2026.

SpaceX, Tesla to Spend $16.8B on Terafab Chip Factory in Texas

SpaceX merged with Musk’s AI company xAI (which has been renamed SpaceXAI) earlier this year, bringing its AI efforts and plans for space-based data centers under the same corporate umbrella. SpaceX subsequently went public in June in what became the largest IPO in history. Intel is also expected to contribute to the Terafab project, with the company revealing its involvement in April this year.

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Announced formally in early August 2026, it is a joint venture between Tesla and SpaceX designed to handle the full chip lifecycle — manufacturing, packaging, and testing of advanced logic and memory devices — under one roof.

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Terafab is designed to manufacture, package, and test advanced logic and memory chips in-house — the kind that will power Tesla's Optimus humanoid robots, Cybercabs, and next-generation high-performance processors.

SpaceX, Tesla Terafab chip plant near College Station: What to know

It’s a joint project between SpaceX and Tesla, which are both based in Texas. Elon Musk, the CEO of both companies, unveiled Terafab in March, saying his future endeavors would require more chips than the global market could supply.

Elon Musk’s Terafab takes first step toward challenging Samsung, SK Hynix, Micron, and CXMT in memory chips

The processor is also expected to feature Qualcomm’s Adreno 850 GPU, which could bring a significant boost to gaming and graphics-intensive workloads. ... A separate benchmark leak has already surfaced for the SM8975, although the early numbers reportedly do not fully reflect the chip’s potential, possibly because of power limitations during testing. That said, a 2nm-class process, 5GHz-plus CPU cores and a new-generation Adreno GPU make the Snapdragon 8 Elite Extreme Gen 6 an intriguing candida