Tesla and SpaceX will invest an initial $16.8 billion to build the “Terafab” chip factory, the companies said Thursday. The advanced chip factory will be built in Grimes County, Texas, outside Houston.
The chip factory “will be the largest and most valuable building on Earth by far,” Tesla and SpaceX CEO Elon Musk wrote in an X (formerly Twitter) post. “And it will be stunningly beautiful.”
The Terafab project is planned to have more than 100 million square feet of manufacturing space, according to the aerospace technology company.
New opportunities will be created for people in Grimes and nearby Brazos County as companies claim the facility will employ at least 3,000 people.
“This facility will house the manufacturing, packaging and testing of advanced logic and memory devices,” Musk’s space technology company SpaceX said in a press release on Thursday (August 6).
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The company also said the facility will produce chips suitable for edge computing and inference for use in hardware like Tesla’s Optimus robot and self-driving Cybercab, “along with high-power chips designed for operating SpaceX’s space-based data centers.”
Intel, a major player in the chip industry, has said it will contribute to the project, according to TechCrunch. However, the company did not specify the exact contribution.
Anderson-Shiro School District Superintendent Dr. Sarah Borowicz believes the agreement will strengthen the district, expand opportunities and better prepare students for the future, according to a statement.
Borowicz said that every opportunity created by this agreement must be managed wisely and transparently, adding, “always with students at the center of every decision.”
Currently, the factories are a crucial asset in the era of AI, technology, and the global economy, which plays a significant role in determining the future of the country.
Texas is not the only U.S. state seeing big investments in semiconductor manufacturing. The United States is seeking to increase domestic chip manufacturing and is witnessing rising demand for AI and advanced technologies, with companies spending billions of dollars on new chip factories and other advanced facilities in states including Arizona, New York, Ohio and New Mexico.
Among these states, Arizona has drawn the largest investment in semiconductors this year. Taiwan’s TSMC has pledged a total of $265 billion in investment in the state to expand advanced chip production.
