Elon Musk confirmed over the weekend that he’s in talks with TSMC, the company that makes almost every advanced chip on earth, about helping build Terafab, his plan for a chip factory meant to supply Tesla, SpaceX, and xAI and nobody else. His own words were something like just discussions, but something may come of it, which from Musk usually means more than it sounds like.
Up to now, the only name attached to Terafab’s manufacturing side was Intel, which was lined up to bring its newest 1.4 nanometer process to the project. If TSMC actually joins, Intel’s role gets a lot more complicated, since TSMC would presumably want to run its own manufacturing process rather than share the floor with a competitor’s technology.
The reason people care about this is pretty straightforward. Tesla needs chips for its cars and robots, SpaceX needs them for rockets and satellites, and xAI needs them to keep training models that can compete with labs that already have years of head start. Musk has said publicly before that chip supply, not ideas, is what actually limits how fast any of these businesses can move.
Nothing is signed. There’s no groundbreaking date, no dollar figure confirmed by either side, and TSMC hasn’t said much publicly at all. That’s worth remembering before anyone gets too excited about a dedicated Musk chip empire showing up next year.
Still, it’s a good sign for the AI industry generally that the company making the most advanced chips in the world is even willing to sit down and talk about building more capacity dedicated to one customer’s needs. More fabs, more capacity, more chips getting made somewhere. That eases a bottleneck that benefits everyone waiting in line, not just the person who got the meeting.
——
Follow: @Ali Demi
Book your free AI clarity call, NOW!
https://buff.ly/TpWy277
——
Sources:
https://www.tomshardware.com/tech-industry/semiconductors/elon-musk-confirms-discussions-with-tsmc-about-terafab-chipmaking-collaboration-intel-is-the-only-other-named-partner-terafab-to-exclusively-supply-tesla-spacex-and-xai
https://teslanorth.com/2026/10/03/elon-musk-confirms-tsmc-terafab-talks/
https://hwbusters.com/news/musk-confirms-terafab-tsmc-talks-and-intels-14a-is-no-longer-the-only-name-in-the-room/
Repost this. Thanks.