Intel to collaborate with Elon Musk on Terafab chip project

Intel CEO Lip-Bu Tan announced that the company will work closely with Elon Musk to support the Terafab project. The initiative involves a joint chip development and fabrication effort by SpaceX and Tesla. A photo shows the executives shaking hands last weekend.

Intel CEO Lip-Bu Tan stated on Tuesday that the chipmaker will “work closely” with Elon Musk on the Terafab project. This venture aims to create a 1-terawatt, ultrahigh performance chip-fabrication facility, potentially spanning multiple locations and costing billions of dollars. The project is being jointly developed by SpaceX and Tesla to advance ambitious semiconductor goals tied to artificial intelligence efforts. Intel’s official X account posted a photo last weekend depicting Tan and Musk shaking hands in front of a large Intel sign, signaling the start of their collaboration. The partnership comes amid Musk's push for cutting-edge chip production to support his companies' needs in AI and beyond. Details on Intel’s exact role remain limited, with the facility's scale highlighting its potential significance in the semiconductors industry.

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Illustration of Tesla's Terafab, the largest chip factory, with Optimus robots, solar satellites, and Elon Musk announcing the project.
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Tesla announces massive Terafab chip factory

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Tesla has announced Terafab, described as the largest chip manufacturing facility ever, in collaboration with SpaceX and xAI. The facility aims to produce 1TW of chips per year to support ambitious projects like solar-powered satellites and millions of Optimus robots. Elon Musk stated it requires thousands of acres and over 10GW of power.

Tesla's Terafab chip manufacturing project is set to launch tomorrow, according to a post by Sawyer Merritt. The initiative addresses anticipated supply constraints for advanced chips. Elon Musk has previously highlighted the need for domestic production.

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Elon Musk has stated that Tesla's next-generation AI5 chip is nearly complete in design, six months after claiming it was finished. Samsung is preparing its Texas factory for trial operations to support AI5 production later in 2026. The chip will be manufactured by both Samsung and TSMC using advanced processes.

Samsung Electro-Mechanics has agreed to a major supply deal with Tesla. The agreement involves FC BGA components worth 16.5 billion dollars for AI6 chips. These chips will support Tesla's self-driving systems and Optimus robot projects.

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Elon Musk announced that Tesla is close to completing the design of its next-generation AI5 chip while starting development on AI6, aiming to produce a new chip annually. The company has deployed millions of current AI4 chips in vehicles and data centers, positioning it as a leader in real-world AI. Musk is recruiting top talent and emphasized ambitious production goals exceeding all competitors combined.

Tesla's ambitious long-term plans for chip development are not getting the attention they deserve, according to a post by Tesla watcher Sawyer Merritt. He highlighted recent job postings as evidence of the company's strategic focus in this area. The observation was shared on X on December 19, 2025.

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Elon Musk hat die Fusion von xAI mit SpaceX offiziell bestätigt und schafft ein Unternehmen im Wert von 1,25 Billionen US-Dollar, das darauf abzielt, Rechenzentren ins All zu verlagern, um die Energiekrise der KI zu bewältigen. Diese vertikale Integration verbindet Raumtransport, Konnektivität und KI-Verarbeitung. Der Plan nutzt die unendliche Solarenergie im Orbit, um Betriebskosten zu senken.

 

 

 

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