SpaceX files plan for $55 billion Terafab chip facility in Texas

Elon Musk’s SpaceX, in a joint project with Tesla, has proposed investing $55 billion to build a semiconductor manufacturing facility, called Terafab, in Texas, according to a filing made public on Wednesday.

The billionaire has been seeking to secure in-house access to advanced chips, though analysts have said the scale of capacity he has outlined would likely require far greater investment.

SpaceX is targeting a June IPO that could value the company at around $1.75 trillion.

The project would involve a multi-phase chip fabrication and advanced computing complex designed to boost domestic semiconductor production capacity in the United States.

SpaceX estimates that the total investment could potentially rise to $119 billion if additional phases are completed.

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The facility is planned in Grimes County within a newly designated reinvestment zone, where local officials are expected to consider a property tax abatement agreement at a June meeting.

Musk has repeatedly warned of constraints in advanced chip supply, calling computing power the key bottleneck for scaling artificial intelligence systems.

The proposed facility could help reduce reliance on external suppliers such as Samsung and Taiwan Semiconductor Manufacturing Co.

The plan also aligns with a broader U.S. effort to expand domestic semiconductor manufacturing capacity amid geopolitical tensions and supply chain risks.