Musk Officially Launches Terafab Project: Targets 1 Terawatt Computing Power Annual Production, Primarily for Space Deployment

SpaceX and Tesla jointly announced the Terafab project at 8 p.m. Eastern Time on Saturday, with a live broadcast on the X platform. The goal of the Terafab project is to produce 100 billion to 200 billion advanced 2-nanometer chips annually.

SpaceX founder and Tesla CEO Elon Musk reposted the live stream and stated that Terafab’s target annual capacity is to produce 1 terawatt (trillion watts) of computing power. Since the United States’ annual electricity generation is only 0.5 terawatts, most of the future computing power must be transferred to space.

In a earlier tweet, he also pointed out that the manufacturing of AI chips at Terafab will cover logic, memory, and packaging, with 80% of the chips produced used for space applications and the remaining 20% for ground use.

Terafab will be located in Austin, Texas, and operated jointly by SpaceX and Tesla.

Grand Plan

Musk has stated that although semiconductor production has been increasing, the growth rate is still too slow to meet his expected chip supply needs. This is one of the main reasons he is pushing for Terafab.

At the launch event, Musk emphasized that the project is expected to produce two main types of chips. One type will be optimized for edge computing and inference, mainly used in Tesla electric vehicles, autonomous taxis, and the Optimus humanoid robot. The other will be high-performance chips designed specifically for space applications, for use by SpaceX and xAI.

Among them, AI5 is designed as a dedicated chip for Tesla’s full autonomous driving system and the Optimus robot, with performance and computing power 40 to 50 times higher than the current AI4. The next-generation AI6 is expected to complete its design by the end of this year, mainly for the second-generation Optimus robot and large-scale inference clusters. The D3 chip is designed for space environments and will provide computing power for Starlink, Starship, and other projects.

During the launch, Musk also showcased a design diagram of future mini AI data center satellites, which are part of SpaceX’s large satellite system aimed at complex space computing. In January this year, SpaceX applied to the U.S. Federal Communications Commission to launch 1 million data center satellites.

However, Musk himself has no experience in semiconductor manufacturing. Given the industry’s typically huge investment scale and the complexity of manufacturing equipment, mass production of Terafab is unlikely in the short term. During the live broadcast, Musk did not provide a specific timeline for the construction or mass production of the Terafab project.

Raising funds for space construction and the launch of AI data centers is also one of the main drivers for SpaceX’s planned IPO later this year. Reports indicate that SpaceX is expected to go public this summer, with a valuation potentially exceeding $1.75 trillion.

(Source: Cailian Press)