Musk Unveils $25 Billion 'Terafab' Consolidating Tesla, SpaceX, and xAI Chip Production

Elon Musk launched Terafab, a $25 billion semiconductor fabrication facility on Tesla's Austin campus consolidating chip production for Tesla, SpaceX, and xAI. At full capacity, the facility would produce roughly 70% of TSMC's current output at 2-nanometer process technology. Musk claims 80% of compute output will support space-based orbital AI satellites, leveraging solar irradiance advantages in orbit. The venture targets two chip types: an edge-inference processor for Tesla's FSD, Optimus robots, and robotaxis, plus a space-hardened variant for SpaceX satellites and orbital data centers.