Intel is set to join SpaceX and Tesla in a plan to build a new semiconductor facility in Texas, though the exact role it will play has not been fully detailed.
In a post on X, Intel said its expertise in designing, manufacturing, and packaging high-performance chips at scale could support Terafab’s goal of producing 1 terawatt per year of compute power. The output is expected to support future developments in AI and robotics, but the company did not share further specifics.
Elon Musk laid out the project in March. He also disclosed an effort by SpaceX and Tesla to create chips for AI workloads, satellite systems, and a potential space data center. The effort could also feed Tesla’s long-term plans for autonomous vehicles and robotics.
But building a semiconductor fabrication plant is an expensive, complex undertaking. These facilities can take years to build and cost more than $20 billion. They also depend on highly controlled environments and advanced machinery to make chips with ultra-fine precision.
This raised questions about how SpaceX and Tesla, which lack direct expertise in chip manufacturing, would oversee such a project.
Intel’s involvement offers some clarity. The company has been working to expand its foundry business and attract major customers. With SpaceX and Tesla now tied to the effort, Intel gains two high-profile partners. At the same time, the project may rely more on Intel’s established manufacturing approach rather than a completely new model driven by Musk’s companies.
Intel was once the dominant force in U.S. chip production but has faced increasing competition from companies like Nvidia and AMD, which focus on chip design while outsourcing manufacturing. Following the news, Intel’s stock rose more than 3%, reaching around $52.28 during trading.
