SpaceX, Elon Musk’s space company that also includes his AI venture, xAI, might spend up to $119 billion on a new chip factory in Grimes County, Texas. A proposal on the county website suggests an initial investment of at least $55 billion.
The company estimates the total cost could reach $119 billion for what they call a “multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility.” Musk has previously talked about this project, named “Terafab.” Tesla will also contribute resources to the effort. They have even brought in chipmaking giant Intel to help develop chips for AI servers, satellites, SpaceX’s planned data center in space, and for Tesla’s self-driving cars and robots.
The billionaire has stated that this manufacturing facility will eventually make enough chips to provide 1 Terawatt of power per year. He argues that current semiconductor manufacturers aren’t producing chips fast enough to meet his companies’ needs for artificial intelligence and robotics. He wrote, “We either build the Terafab or we don’t have the chips, and we need the chips, so we build the Terafab.”
However, Musk clarified in a tweet on Wednesday that Grimes County, Texas, is just one of several places they are considering for the factory. This filing comes as Musk has focused heavily on making sure xAI has enough computing power to train and run its Grok AI models. He also aims to profit from the demand for AI computing by building data centers in space, which he mentioned as a big reason for merging xAI with SpaceX. The combined company is reportedly valued at $1.25 trillion and is expected to go public in June.
