Tesla and SpaceX have formally announced plans to build 'Terafab,' a massive advanced semiconductor factory in Grimes County, Texas, north of Houston. The initial investment is $16.8 billion, with SpaceX filings suggesting total spending could reach $119 billion across multiple construction phases. The facility is planned to exceed 100 million square feet, making it the largest building on Earth, and will employ at least 3,000 people locally. Terafab will produce chips for edge computing and inference — targeting Tesla's Optimus robots, self-driving Cybercabs, and SpaceX's space-based AI data centers. Intel has also signed on to contribute to the project. The announcement followed a contentious county meeting where residents raised concerns about tax breaks and transparency.
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What is the Terafab chip factory and who is building it?
Terafab is a joint advanced semiconductor fabrication facility being built by Tesla and SpaceX in Grimes County, Texas, north of Houston. The initial investment is $16.8 billion, with total projected spending potentially reaching $119 billion across multiple phases. The facility is planned to exceed 100 million square feet and will produce chips for Tesla's Optimus robots, self-driving Cybercabs, and SpaceX's space-based AI data centers. Intel is also a contributor. Developers building on AI inference hardware can track semiconductor supply chain developments like Terafab on daily.dev.
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