Tesla is set to become Intel's first major customer for its advanced 14A chip manufacturing technology. CEO Elon Musk confirmed Wednesday that Tesla's Terafab project will utilize this cutting-edge process.
This development is a significant win for Intel as it strives to compete with rivals like TSMC and attract outside clients to its manufacturing services. Intel's shares saw a 3.6% increase in extended trading following the announcement.
Musk indicated that 14A is the logical choice for Terafab, stating, "Given that by the time Terafab scales up, 14A will be probably fairly mature or ready for prime time, 14A seems like the right move, and we have a great relationship with Intel."
The Terafab project, envisioned in Austin, involves SpaceX and Tesla building advanced chip factories. One facility will produce processors for Tesla's cars and humanoid robots, while another will be dedicated to artificial intelligence data centers, potentially for space applications.
This partnership could bolster investor confidence in Intel's next-generation manufacturing capabilities, addressing past yield issues. While many details of the Terafab project, including funding and operational timelines, remain undisclosed, securing a major customer like Tesla is seen as a critical step for Intel's comeback strategy.