Tesla CEO Elon Musk is launching the "Terafab" project to produce proprietary artificial intelligence chips.
According to Bloomberg on the 21st (local time), Musk announced plans to build a fab (semiconductor production facility) at Tesla's "Giga Texas" production plant in Austin, Texas. "If we don't build Terafab, we can't get the chips, and we need chips, so we're building Terafab," he said.
Musk pointed out that the semiconductor industry produces chips too slowly. "The pace is much slower than we would like," he said. "We're very grateful to Samsung Electronics, TSMC, Micron, and other existing supply chains, but there are limits to how fast they can scale."
Musk's plan is to first build an "advanced technology fab" in Austin equipped with cutting-edge equipment needed to manufacture and test all types of chips. The entire process from design to testing can be performed within a single facility. Bloomberg reported that "the project appears to be planned for an area near Tesla's existing Austin headquarters and Gigafactory."
The fab will produce dedicated chips supporting 1 terawatt (TW) of computing power for use by Tesla and SpaceX. Tailored to both companies' characteristics, the facility is expected to manufacture two types of chips: those optimized for on-device AI and processing for vehicles, robotaxis, and Optimus humanoid robots, as well as high-power chips for space applications.
Earlier in January, Musk said during Tesla's earnings conference call that "we need to build the Tesla Terafab to remove constraints that are likely to occur in the next three to four years." He described it as "a domestic production facility that includes very large-scale logic, memory, and packaging."