SpaceX could invest as much as $119 billion to build its Terafab, a proposed semiconductor manufacturing and computing fabrication facility in Texas, according to local documents tied to a tax abatement request. The Commissioners Court of Grimes County will hold a public hearing on June 3 to consider the deal.
The notice states that SpaceX would locate the multi-phase, vertically integrated Terafab at the Gibbons Creek Reservoir and surrounding areas between Austin and Houston. The project’s initial phases could involve up to $55 billion in investment, with total spending potentially reaching $119 billion if additional phases move forward.
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The project represents a collaboration between SpaceX, Tesla and xAI, all companies in which Elon Musk serves as CEO. According to a social media post shared by Tesla, the Terafab would manufacture 1 terawatt of chip output per year, which the company claimed would exceed the combined output of all global chipmakers.
Neither the companies nor local officials announced a timeframe.
SpaceX revealed Terafab in March and described it as “the next step towards becoming a galactic civilization.” The company said the plant would make chips for Tesla’s electric vehicles and Optimus humanoid robots, as well as SpaceX spacecraft.
Tesla designed the bipedal, autonomous Optimus robot to perform dangerous, repetitive and boring tasks. According to CBS News, Musk said the automaker could begin selling the robot in 2027.
As for space travel, the Terafab aligns with SpaceX's broader plans involving solar-powered AI satellites and future space operations.
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