Musk Confirms TSMC Talks Over Terafab Chip Project

Elon Musk has confirmed that his Terafab semiconductor project is in discussions with TSMC over a possible collaboration, after the talks were first reported by Tim Culpan's Culpium newsletter. In a post on X early Saturday, Musk wrote that the two sides were only in discussions but that something may come of it, according to Tom's Hardware. TSMC has not commented publicly.

According to Culpan's reporting cited by Tom's Hardware, one scenario under consideration would have TSMC own and operate a new chip production facility that exclusively serves Musk's Tesla, SpaceX, and xAI, with SpaceX or Terafab potentially investing in the venture, committing to buy a guaranteed volume of chips, or both. The exact ownership structure is still being worked out.

Tom's Hardware reported that an alternative structure would put SpaceX in majority control of the venture, with TSMC investing less while providing operational expertise and process technologies. The outlet noted that the first arrangement could resemble TSMC's JASM and ESMC joint ventures in Japan and Germany, where local partners supply capital and demand while TSMC contributes its process technology and runs the fabs. It also reported that TSMC's rumored plans for a fab complex in Texas have been tied to supporting Terafab.