Elon Musk Announces Terafab: $25B Tesla/SpaceX/xAI Chip Factory in Austin

Bloomberg·high signal

Elon Musk unveiled 'Terafab' at an Austin event Saturday night — a joint $25 billion chip fabrication facility at the Tesla Gigafactory campus targeting 2nm process technology, 1 terawatt of annual compute, and consolidating design through packaging under one roof. The facility will produce two chip categories: inference chips for Tesla vehicles and Optimus robots, and D3 chips for orbital AI satellites. Small-batch AI5 production is targeted for 2026 with volume in 2027; critics are calling it a desperation move given Tesla's current AI infrastructure gap versus NVIDIA.