Tesla and SpaceX CEO Elon Musk has been quite bullish on TeraFab since its March 2026 announcement. We also recently covered Tesla’s successful tape-out of its AI5 AI chip, developed in collaboration with Samsung and TSMC. Now, it looks like Tesla may not need manufacturing partners in the near future, as work on TeraFab is advancing rapidly under Musk’s direction.
According to a report by Bloomberg, the team tasked with bringing Terafab to life has been hard at work lately, aggressively tapping suppliers to secure pricing and delivery times. The report states that Musk’s team has already approached Applied Materials Inc., Tokyo Electron Ltd., Lam Research Corp., and Samsung Electronics Co. Apparently, Elon Musk wants this phase of the plan completed at “light speed”.
It has been reported that the TeraFab team is not providing specifics about what they are planning to build, but they are demanding speedy responses from the contacted companies. Under Musk’s direction, the team apparently contacted a company during a Friday holiday. It demanded that the estimate be delivered the following Monday, which gives us an idea of the pace the CEO wants to set.
Musk has recently criticized TSMC and other existing fabs for not having sufficient capacity to meet Tesla’s and his other companies’ needs. In a recent tweet, the Tesla CEO stated that TSMC couldn’t produce the large number of chips they needed, which is why he started the TeraFab project in partnership with Intel. He also stated that SpaceX and Tesla will always be major customers of TSMC and that they are “not competitors in the normal sense of the word.”
That said, TeraFab is still far from a reality despite Musk’s hasty timelines. Speaking at the TSMC Q1 FY26 earnings call, TSMC CEO C.C. Wei said there are no shortcuts to building a fab, and it takes 2-3 years to build, with an additional 1-2 years needed to ramp it up. So it remains to be seen how quickly TeraFab will be up and running, and whether it will be enough to meet the demands of Musk’s companies.
