Elon Musk says TSMC in talks for a Terafab deal to supply Tesla, SpaceX and xAI, while also weighing a Texas presence.
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| Source: Techmeme | Original article
Elon Musk said TSMC is in talks about a Terafab agreement to supply Tesla, SpaceX and xAI, while the chipmaker also weighs opening a facility in Texas.
Elon Musk has confirmed that Taiwan Semiconductor Manufacturing Co. (TSMC) is in talks with his companies about a “Terafab” partnership that would see the foundry supply chips for Tesla, SpaceX and xAI. The discussion, revealed in an exclusive interview with Tim Culpan of Culpium, also notes that TSMC is weighing a potential manufacturing footprint in Texas, although Musk offered no further details.
The move matters because a dedicated “Terafab” – a high‑capacity, advanced‑process facility – could give Musk’s enterprises a more secure and possibly cheaper supply chain for the custom silicon that powers everything from autonomous‑driving processors to satellite‑communication chips and AI accelerators. For TSMC, securing a marquee client such as Tesla or SpaceX would provide a strong anchor for any new U.S. fab, helping the company meet growing demand for domestic production amid geopolitical pressure to diversify away from Asian sites.
What to watch next includes whether TSMC will announce a formal Texas location, the scale and technology node of the proposed Terafab, and how quickly the partnership could translate into silicon for upcoming vehicle models, launch vehicles or xAI’s next‑generation models. Industry observers will also track any regulatory or trade‑policy hurdles that could affect cross‑border chip supply, as well as reactions from rival foundries that may vie for similar anchor‑client deals in the United States.
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