SpaceX only added this division earlier this year when it acquired xAI, another company founded by Elon Musk. The AI division encompasses the social media platform X, the Grok intelligence platform, the company's data centers, and a planned terafab facility built in partnership with Tesla and Intel.
Both facilities are still smaller than the planned Terafab in Aggieland, a $20-billion-plus project that aims to build out next-gen semiconductor manufacturing. The industrial property will also help scale production in other areas of Musk’s fiefdom, namely Tesla, SpaceX, xAI and the new Gigasat facility.
Tesla's robotaxis could eventually ... are also expected to collaborate on Terafab, a proposed semiconductor manufacturing facility in Texas involving Tesla, SpaceX, and Intel....
More importantly, the two companies share numerous intersections and are even inextricably linked, primarily in three areas: (1) Cross-shareholding: Tesla previously invested $2 billion in xAI, and this investment has automatically converted into SpaceX shares following the merger of SpaceX and xAI; (2) Related-party transactions: Over the past year, SpaceX has purchased Megapack energy storage systems worth up to $697 million from Tesla, and additionally spent $131 million on Tesla electric veh
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Trump didn’t elaborate on that tie-up, which he mentioned after championing Nvidia Corp. and Elon Musk’s Terafab chipmaking ambitions in a Truth Social post. The iPhone maker has held exploratory discussions about using Intel and Samsung Electronics Co.
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About 80 percent of Terafab's output is targeted at space applications, with the remaining 20 percent destined for terrestrial use. The primary chip destined for the satellites is the D3, a processor SpaceX is designing specifically for space environments — built to run hotter than conventional chips and hardened against the radiation levels found in low-earth orbit. Musk described chip production as "the major piece of the puzzle" in the broader orbital computing ambition, saying
The effort pairs with Terafab, a chip-fabrication plan Musk announced on March 21, 2026 in Austin and described as jointly run by Tesla and SpaceX, aiming to eventually reach more than one terawatt of AI compute capacity per year.
The company will also use the funding for future artificial intelligence products and infrastructure, including a chip factory known as Terafab that SpaceX will build with Tesla and Intel in Texas.
Dan Ives at Wedbush wrote Thursday that he sees Tesla and SpaceX merging next year, and called it the “holy grail” for Musk’s AI play, Business Insider said. Tesla and SpaceX already cross over on some projects such as the Terafab chip, the report said, and Tesla’s earlier xAI investment turned into a SpaceX stake when SpaceX merged with xAI in February, according to Business Insider.
Shotwell didn’t elaborate on the specific synergies that exist between Tesla and SpaceX, but the two companies are already collaborating in some areas, including jointly running Musk’s planned $55 billion “Terafab” facility, which will produce chips for robotics and space travel.
Musk estimates all existing chip fabs produce just 2% of SpaceX's future computing needs, driving plans for Terafab and orbital data centers. Intel, Tesla, CoreWeave, and GlobalFoundries top SpaceX's possible acquisition list as it builds ...
He described Tesla as operating the research fab, while SpaceX would handle the early-stage buildout for the Terafab—an approach that suggests a pilot-line model intended to validate technical feasibility and economics before scaling to full industrial volumes.
Specifically, Terafab will use Intel's next-generation fabrication technology, and the capital SpaceX raised in its IPO could be a major source of funding to get the Terafab project going.
In May, SpaceX announced plans to invest $55 billion to build a "Terafab" semiconductor factory in Texas, producing chips for artificial intelligence as well as robotics.
Though Musk says that the AI satellites are simpler in architecture, that’s a lot to ask for a production facility that hasn’t been built yet. The company is also still building out its solar panel production facility. That’s before we get to Terafab, the company’s much-discussed chip foundry, which Musk sees feeding into the later stages of this product as the company tries to scale up to a terawatt of annual compute production.
The two companies are also co-investors in "Terafab," a joint facility with Intel for manufacturing AI microchips, with a first-phase cost estimated at $55 billion. In other words, the operational and financial overlap between Tesla and SpaceX ...
BofA pointed to potential opportunities tied to Apple M-Series wafers, MediaTek TPU wafers, advanced packaging, Terafab engagements, and other ARM-based server CPU work.