Elon Musk says his business empire will build and operate the Texas-based Terafab chipmaking project, quashing speculation about TSMC having an operational role

Debby Wu /Bloomberg:

Bloomberg 2026-10-07 Debby Wu

Context & Ripple Effects

Terafab began as a Tesla-SpaceX project to make chips for Tesla, xAI and SpaceX, positioning its customers as its initial industrial base rather than as outside buyers. Reports days earlier described unconfirmed TSMC supply discussions, leaving the scope of a potential relationship unclear.

The project had already secured a Texas property-tax exemption amid local opposition. Musk's statement assigns the practical responsibility for building and running the facility to his own companies, sharpening who local officials and critics can hold accountable.

First-order effects

Tesla and SpaceX retain control of Terafab's construction and operations, while also taking on the execution burden of running the fab themselves.
Musk's stated boundary limits TSMC to a possible supply arrangement or sublease rather than an operating role; the underlying supply discussions remain unconfirmed.

Second-order effects

Tesla, SpaceX and xAI will need to align their chip demand with a manufacturing program directed by affiliated companies, tying the fab's utilization more closely to their own product roadmaps.
Texas officials and local opponents gain a clearer operating counterparty for commitments associated with the project's tax treatment and footprint.

Third-order effects

If Terafab is built as described, it would extend vertical integration from chip design and captive demand into fab operations, concentrating more of the AI-hardware supply chain within one corporate orbit.
Projects that pair large local incentives with captive AI-chip production may make operator accountability a more central part of semiconductor siting debates.

The trend: Terafab is a data point in the shift toward vertically integrated, workload-specific silicon programs in which major AI infrastructure buyers seek greater control over manufacturing.

Discussion

@elonmusk Elon Musk on x
@herbertong @thejefflutz No, we will build and run the fab. Let there be ZERO doubt about that. Maybe TSMC subleases part of the Terafab if they want, but nothing more than that.
@elonmusk Elon Musk on x
@wholemars Just discussions, but something may come of it
@the_ai_investor @the_ai_investor on x
Lol so all of the tsmc related rumors are false
@mzuhair123 Muhammad Zuhair on x
Nothing surprising here. The TSMC-TeraFab talk rumors were based on the wrong idea, which doesn't support Elon's ambitions of vertically integrating the supply chain. Intel's the primary partner, let there be no confusion in it.
@mark_k Mark Kretschmann on x
SpaceX is reportedly seeking $40 BILLION just to buy Nvidia chips. 🔥 That's hardware alone, before the electricity, cooling and facilities needed to run it. According to Reuters, citing the Financial Times, Apollo is arranging roughly $10 billion in bank loans and another $30 bil…
@alexgibneyfilm Alex Gibney on x
Note: @elonmusk is trying to raise $40 billion in debt to buy NVIDIA chips. Here's the sloppy stoner way he makes his pitch: (from the FT)
@edzitron Ed Zitron on x
Why isn't this closing until 2027?
@edzitron Ed Zitron on x
Bahahahahahhaah
@jg_nuke @jg_nuke on x
Another $40 billion borrowed from somebody's retirement to pay for datacenters...innnnnn spaaaaace!!!
@rohanpaul_ai Rohan Paul on x
Bloomberg: SpaceX is in early talks to borrow $40B for Nvidia chips, with Apollo Global Management leading. The package would pair about $10B in bank loans with $30B of investment-grade debt and should close in 2027, according to the Financial Times. Musk has earlier said SpaceX …
@lihong062 Lihong on x
suggested at dinner that valuations may be stretched right now (didn't even used the b-word) and got told that my lack of faith was disturbing
@cosmic_andrew1 Andrew on x
Lmao
@annmarie Annmarie Hordern on x
FT: Elon Musk's SpaceX is seeking to raise $40bn to purchase Nvidia chips as the AI and rocket group amplifies its bet on the chipmaker's advanced technology.
@sindap Sujeet Indap on x
Moody's and S&P rated this company as investment grade and its debt is going to be all over retirement and annuity accounts:
@kakashiii111 @kakashiii111 on x
SpaceX raised $100B as of the end of June 2026, and yet they look to borrow $40 billion, just less than 4 months after having such an amount, to buy more Nvidia chips? Nothing surprising. Elon is not rational when it comes to spending money and buying chips. Buy chips first, buil…
@staunovo Giovanni Staunovo on x
SpaceX looks to raise $40bn to buy Nvidia chips in financing led by Apollo Blockbuster debt deal is the latest sign of the vast spending on chips and other infrastructure underpinning AI https://www.ft.com/...
@cb_doge @cb_doge on x
BREAKING: SpaceX is reportedly looking to raise $40 billion to buy NVIDIA chips in financing led by Apollo. The planned package includes $10B in bank loans and $30B in investment-grade debt, as per Financial Times. There is no confirmation from Elon Musk and SpaceX on this yet.
@lewjackk Lewis Jackson on x
Investors “received a short two-page deal memo with pictures of outer space and an arrowing point out that the company was going to build data centers ‘somewhere in the universe’ Amazing detail on the SpaceX financing in the FT https://www.ft.com/...
@gradientintern @gradientintern on x
so $40 billion out of $690 billion projection from $NVDA will be from $SPCX at least with this debt raise. did SpaceX already allocate the $75 billion from ipo + $10 billion from greenshoe? rip consumer tech after the rest of the AI IPOs kek
@the_ai_investor @the_ai_investor on x
SPCX, NVDA: $40B financing led by Apollo to buy Nvidia chips + SpaceX plans to raise $40B to buy Nvidia AI chips, per the Financial Times via Reuters on Oct 6. The plan is about $10B in bank loans plus $30B in investment grade debt, led by Apollo, with Pimco among the lenders in …
@okane.fyi Sean O'Kane on bluesky
SpaceX is basically daring lenders to pony up $40 billion so it can buy Nvidia chips on what sounds like a cocktail napkin — www.ft.com/content/d3f5... [image]
r/wallstreetbets r on reddit
SpaceX looks to raise $40bn to buy Nvidia chips in financing led by Apollo
@thejefflutz Jeff Lutz on x
@elonmusk @herbertong Makes sense and this creates immediate favorable leverage for Tesla/Spacex well before Terafab starts production
@amy787 Amy on x
Solving the chip constraint is necessary for both Tesla and SpaceX. End the idea right now that any other company will build and run the Terafab. It will be owned & operated by SpaceX/Tesla. “No, we will build and run the fab. Let there be ZERO doubt about that.
@business @business on x
Intel will continue to work with Elon Musk on Terafab, an audacious attempt by the trillionaire to break into the production of cutting-edge chips, according to Chief Executive Officer Lip-Bu Tan. https://www.bloomberg.com/...

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