SpaceX is moving forward with Terafab, a massive semiconductor manufacturing initiative, beginning with a $55 billion investment in Texas.
The facility, near Gibbons Creek Reservoir, would produce advanced 2-nanometer chips and could scale to $119 billion in total capital spending.
A June 3 public hearing in Grimes County will decide on tax incentives for the project, described as transformative for US semiconductor manufacturing.
Terafab is a joint venture between SpaceX, Tesla, and xAI, with Intel joining as a strategic manufacturing partner in April 2026. Musk launched the project in March, calling it a survival necessity.
The facility-projected at 100 million square feet-will require thousands of acres and more than 10 gigawatts of power. Target production is one terawatt of computing output per year using 2nm process technology, with pilot production slated for late 2026.
This move positions SpaceX against industry leaders like Taiwan Semiconductor Manufacturing Co.