Elon Musk has dismissed claims that TSMC will operate the planned Terafab semiconductor plant in Texas. Musk confirmed that Tesla and SpaceX will build and run the facility directly, limiting any TSMC involvement to leasing physical space. The clarification comes as Intel works to protect its own manufacturing role within the $16.8 billion project.
Musk clarified the operational structure of the plant following online speculation that TSMC might take charge of the project. A post on the social network X suggested that TSMC would own and manage the fabrication site while SpaceX supplied capital or purchase commitments. Musk rejected that arrangement directly.
No, we will build and run the fab. Let there be ZERO doubt about that.
— Elon Musk (@elonmusk) October 7, 2026
Maybe TSMC subleases part of the Terafab if they want, but nothing more than that.
The statement sets clear boundaries after Musk previously confirmed preliminary talks with the Taiwanese chipmaker, stating only that discussions were ongoing.
Terafab is designed as a vertically integrated semiconductor foundry built to supply silicon for Tesla and SpaceX operations. The project involves an initial investment of $16.8 billion and aims to hire at least 3000 workers. Intel joined the project earlier this year without disclosing its exact operational scope. Following rumors of TSMC involvement, Intel shares dipped as market analysts questioned whether the company would lose its position.
Intel chief executive Lip Bu Tan addressed the market uncertainty during an industry appearance in Tokyo marking 50 years of company operations in Japan. Tan stated that Intel will continue working with Musk on the Terafab program, attempting to ease investor worries regarding competition from TSMC.
Talks around Terafab occur while TSMC reviews potential expansions within the United States. Reports indicate that TSMC has considered a new manufacturing campus in Texas, distinct from its existing $265 billion commitment in Arizona. The Texas project remains in early planning, and TSMC representatives declined to provide comments on the matter.
