Musk Says SpaceX-Tesla Chip Venture Terafab Targets 1 Terawatt of AI Compute by Q3 2028

Elon Musk said during a SpaceX conference call on October 20, 2026, that Terafab, a chipmaking venture jointly established by SpaceX and Tesla, plans to reach volume production in the third quarter of 2028. The fab is expected to produce 1 terawatt of compute capacity annually for artificial intelligence and robotics businesses. Musk acknowledged that the timeline is highly challenging and that he has built in a wide margin of error.

Musk also revealed that Terafab's internal target is to produce its first working test chip using static random-access memory (SRAM) circuits at its Austin, Texas R&D base around May or June 2027. He noted that chipmakers typically fabricate SRAM circuits first to refine their manufacturing processes. He said volume production in the third or fourth quarter of 2028 is at least a possible outcome, though he described the schedule as "almost absurdly fast" given the typically long chipmaking cycle.

The planned Texas complex is designed to handle advanced logic chip and memory chip manufacturing, packaging, and testing on a single campus. Musk thanked ASML and other suppliers for accelerating equipment deliveries to help the project pursue its goals. Terafab faces the challenge of procuring sufficient precision semiconductor manufacturing equipment. In April 2026, Intel announced it would join the Terafab project, though the specific form of cooperation has not been disclosed.