Elon Musk stated that his companies are likely to improve chip quality better than anyone else, thanks to the equipment they make themselves. This was reported by Bloomberg. The statement came amid the advancement of the Terafab project, a joint initiative by Tesla and SpaceX to produce chips, designed to reduce dependence on external factories that currently produce the chips they need.
Terafab is planned as a vertically integrated manufacturing complex in Texas. The main goal of the project is the mass production of AI5 chips, specialized chips for AI inference, which is the work a model performs when answering a question or making a decision. Terafab aims to produce 1 terawatt of computational capacity per year. This refers to total computational power, not electricity consumption. The deployment is phased: pilot production is being built next to Tesla's Gigafactory in Texas, with larger capacities planned in Grimes County, also in Texas.
Musk claims that the AI5 chip can provide performance per watt 2–3 times better than Nvidia's products and at about 10% of their cost. These figures are Musk's statements and forecasts, not independently verified metrics.
Intel is officially a partner in the project for technological support, specifically regarding the 14A technology node. With TSMC, the Taiwanese giant that produces chips for most of the industry, negotiations remain exploratory, with operational involvement limited. Samsung, another major manufacturer, is one of the external suppliers from which Terafab aims to reduce dependence.
For Musk, this line is long and overloaded. Tesla needs chips for autonomous driving systems and robotics, while SpaceX has its own computational needs. Relying on TSMC and Samsung means competing for capacity with all other tech companies chasing the same AI boom. Building his own factory is Musk's answer to this bottleneck. This follows a familiar pattern: Tesla moved battery production closer to home, and SpaceX builds most of its rocket equipment itself.
This material is prepared solely for informational purposes and does not constitute financial advice or a recommendation.