Musk: ASML and suppliers speeding up parts for Texas chip plant

Tesla and SpaceX Chief Executive Elon Musk said critical semiconductor toolmakers, including ASML, are moving up equipment deliveries for Terafab, a joint chip factory the two companies are building in Texas.

Musk described the schedule during a livestreamed SpaceX earnings call for the third quarter of 2026 that aired on the X platform on October 20. He said volume production at the Gibbons Creek, Texas site is being targeted for the third or fourth quarter of 2028. He stressed that the plan is highly aspirational and carries "big error bars."

"These are very aggressive dates, and we're very appreciative of ASML and all of our other suppliers in accelerating equipment deliveries in order to achieve this outcome," said Musk, who leads both companies behind the project.

SpaceX expects to build its first experimental test chip at its research fabrication facility in Austin, Texas, around the second quarter of 2027. Terafab is designed to make logic, memory, and advanced packaging in one location, and to turn out 1 terawatt of AI computing power per year once it reaches full scale. The facility will use extreme ultraviolet lithography systems running on Intel's 14A manufacturing node. Intel joined the venture in April 2026 to help develop and adapt fabrication technology and to supply that process.

ASML is the sole commercial supplier of the $400 million extreme ultraviolet lithography systems required for high-volume, leading-edge chip production. An unofficial report had the first such tool for Terafab set for delivery in mid-2027, and it remains unclear whether the accelerated schedule Musk mentioned refers to that date. Other suppliers for front-end processing, metrology, and process control machinery are Applied Materials, Lam Research, KLA Corporation, and Japan's Tokyo Electron. Tesla and SpaceX are also talking with about 10 South Korean equipment makers, among them Hanmi Semiconductor, which makes advanced packaging equipment, and HPSP, which makes high-pressure hydrogen annealing equipment, along with firms that provide specialized piping components and process valves.

Musk also set out targets for computing capacity at his AI companies. He expects 2.5 to 3 gigawatts of capacity to be running by the end of 2026 and said he is highly confident about adding 10 gigawatts in 2027, which would put the total at 13 gigawatts by the end of that year. To reach that mark, SpaceX and xAI are acquiring Nvidia's next-generation Vera Rubin architecture, with plans for a 440,000-GPU training cluster to be online by the end of the second quarter of 2027. By comparison, the restructured 10 gigawatt Project Stargate is set to reach full capacity in the 2030s, and Meta's 5 gigawatt Hyperion has a similar timeline.

Musk said that once Terafab is fully scaled and running, the value of its chip output would rank alongside the gross domestic product of one of the world's top 20 countries from a single building. The 20th country on that list is Switzerland, with a GDP of about $1.14 trillion. The facility would supply chips for xAI clusters, self-driving vehicles, Optimus humanoid robots, SpaceX's orbital AI data center, and the wider AI industry.

Questions about the plan's scale remain. Research firm Gartner estimates total global AI-optimized data center capacity at roughly 44 gigawatts as of late 2026, about 4.4 percent of the output Terafab aims to produce. Global AI computing capacity has grown by roughly 3.3 to 3.4 times per year since 2022, according to EpochAI. The project's timeline and its stated output will be watched as tool deliveries arrive and as the first test chips are built in Austin in 2027.

The next milestones to watch are the Austin test chip run in the second quarter of 2027, any firm delivery dates for extreme ultraviolet lithography systems, and progress on the computing capacity targets for the end of 2026 and 2027.