Elon Musk Wants to Build His Own 'Gigantic' Chip Fab

Elon Musk Plans to Build a Massive Chip Fabrication Plant

Elon Musk, CEO of Tesla, announced during the company's annual shareholders meeting his intention to enter the chip manufacturing industry. Despite Tesla already purchasing all available chips from major suppliers like TSMC and Samsung, the demand for silicon in Tesla's electric vehicles and robotics projects remains unmet.

Challenges in Chip Supply and Energy

Musk highlighted that the availability of chips and electricity supply are current "limiting factors" for Tesla's production scale. He stated,

“As far as I can see, the only option is to go build some very big chip fab. And then you have to solve memory and packaging, too. But otherwise, you just tap out at whatever the chip production rate is.”

Tesla Terra Fab: A Gigantic Manufacturing Ambition

The planned factory, named Tesla Terra Fab, is intended to massively ramp up chip output. Musk described the facility as “gigantic” with an initial target of producing at least 100,000 wafer starts per month—equivalent to five times the output of TSMC's first Arizona fab.

He further revealed ambitions for a much larger complex:

“So ultimately, it’d be a million wafer starts per month,”
Musk added, emphasizing the scale of his vision.

Summary

Elon Musk envisions solving Tesla's chip shortage by creating an expansive chip manufacturing plant complex, aiming to exceed current industry production capabilities significantly.

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PCMag PCMag — 2025-11-07

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