Elon Musk: Terafab to be the world's largest and most advanced chip factory, multiple locations under consideration
Elon Musk stated that a certain location being considered is one of the candidate addresses for the Terafab project, which will be the world's largest and most advanced chip manufacturing facility.
Terafab is jointly promoted by Tesla, SpaceX, and xAI, requiring thousands of acres of land and over 10GW of power. Once fully operational, it will far exceed the scale of Giga Texas, aimed at producing AI chips, autonomous driving, Optimus robots, and aerospace chips.
The early stages of the project will include an advanced technology R&D fab, which is currently being evaluated in multiple locations including Austin, with the final site yet to be determined.
Source: Public Information
ABAB AI Insight
Elon Musk has been promoting the Terafab project since 2025, having previously announced the construction of an advanced technology fab near Austin for chip iteration. This reiteration of multiple site evaluations continues his strategy of "announce first, execute later," similar to the approach taken with the Tesla Gigafactory.
In terms of capital, xAI, Tesla, and SpaceX will shift substantial funds (expected to exceed $20 billion) from external foundries to building their own closed-loop chip supply chain, reducing reliance on TSMC/Intel through vertical integration, while directly serving chip capacity for Dojo training, Robotaxi, and Optimus mass production, forming an internal closed loop of "energy-chip-smart hardware."
Similar to Intel's expansion of advanced processes in the U.S. and the global factory competition between Samsung and TSMC, Musk's ventures are currently in the early stages of transitioning chip manufacturing from reliance on Asian foundries to U.S. super fabs.
Essentially, this is a restructuring of the supply chain: Terafab aims to build the world's largest chip facility, reconstructing the dispersed AI chip supply chain into a closed loop within Musk's ecosystem, shifting capital from external procurement to self-owned capacity control. Mechanically, it aims to achieve dominance in "wattage and tonnage" through scale and vertical integration, accelerating the transition from a chip shortage constrained by others to a self-controlled structure.
ABAB News · Cognitive Law
Whoever masters the most advanced chip capacity will control the lifeblood of the next generation of AI and robotics. External foundries, no matter how cheap, cannot match the strategic freedom brought by a self-built closed loop. The true big players are not those who build the earliest, but those who build the largest, most comprehensive, and fastest.