Overview
- SpaceX disclosed on Thursday that it and Tesla will invest $16.8 billion in the first phase of Terafab, a new vertically integrated semiconductor and energy-component complex.
- Company materials describe Terafab as a factory to make AI accelerators for training and inference as well as solar cells and storage chips to meet the firms’ projected compute needs.
- The site is in rural Grimes County near Houston with a planned production area of more than nine million square meters, at least 3,000 jobs in the initial phase, and industrial water taken from the Gibbons-Creek reservoir rather than local groundwater.
- Earlier regulatory filings reported in May proposed a much larger opening investment of $55 billion and a possible $119 billion total if all phases proceed, so the final scale and timing depend on future approvals and financing.
- The project ties into Musk’s consolidation of AI and hardware work after SpaceX’s xAI buy and could reshape local jobs, supply chains and U.S. chip capacity while drawing pushback from some Grimes County residents over oversight and public incentives.