SpaceX has a $55 billion plan to build AI chips in Texas
SpaceX plans to invest up to $55 billion in its Terafab AI chip manufacturing plant in Austin, Texas, with potential expansion to $119 billion, targeting 200 gigawatts of Earth-based and one terawatt of space-based computing power. Intel will collaborate on designing and building the chips, which will serve SpaceX, Tesla, AI, robotics, and space data centers.
SpaceX is set to invest at least $55 billion in its Terafab AI chip manufacturing facility in Austin, Texas, according to a public hearing notice filed in Grimes County. The project seeks tax breaks and could expand to a total investment of $119 billion if additional phases are developed. Elon Musk announced the initiative in March, aiming for the plant to produce chips capable of supporting up to 200 gigawatts of computing power on Earth and one terawatt in space. The chips will be used by SpaceX and Tesla for AI, robotics, and space-based data centers. The company already operates a data center in Memphis, Tennessee, which recently agreed to power Anthropic’s AI models. Intel has agreed to assist in designing and building the Terafab chips, leveraging its expertise in high-performance chip production. Intel emphasized that its involvement will help accelerate Terafab’s goal of delivering one terawatt per year of compute power for AI and robotics advancements. The project highlights SpaceX’s growing focus on AI infrastructure, aligning with broader industry trends toward in-house chip manufacturing. The Texas facility will serve as a hub for both SpaceX and Tesla, reinforcing Musk’s vision of integrating AI across multiple sectors. Tax incentives and partnerships like Intel’s are critical to realizing the ambitious scale of the Terafab initiative.
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