Elon Musk has acknowledged that early talks with Taiwan Semiconductor Manufacturing Company (TSMC) could lead the company to its ambitious Terafab semiconductor project, signaling a possible partnership with the world’s leading contract chipmaker. Musk confirmed that the first talks are underway, but that for now they are “just discussions.” There is no confirmation of a deal nor ruling out the possibility of one, leaving open the prospect of one of the largest advanced chip collaborations being discussed in the US. @wholemars Just discussions, but something may come of it — Elon Musk (@elonmusk) October 3, 2026 The report that speculated on possible discussions between Terafab and TSMC comes from Tim Culpan, who outlined some ways the collaboration could operate. One is for TSMC to use the project as an “anchor customer” for future facilities in Texas, potentially contributing process expertise, operational knowledge or capacity, while Terafab provides capital, long-term purchase commitments or both. Tesla and SpaceX jointly developed the Terafab project, and Intel is already involved in the technological aspect. Elon Musk announced the project in March and intends to produce more than a terawatt of AI computing capacity per year once it is fully built. Elon Musk’s Terafab project gets massive new partners. Company statements put the first phase at a cost of approximately $16.8 billion, and subsequent filings point to a total that could reach tens of billions over multiple stages. Intel joined the effort in April 2026 and is expected to supply its 14A manufacturing process for the large-scale plant. Musk has said that existing suppliers, including Samsung and TSMC, remain important for near-term needs; Tesla already has production agreements with Samsung for the AI5 and AI6 chips, but future demand for Optimus robots, Cybercab vehicles and planned space data centers will eventually exceed what the global industry can currently offer. Terafab is positioned as the long-term answer to that projected shortfall, and Tesla did something similar during COVID to avoid chip shortages. This is simply a solution on a much larger scale. If the partnership were to materialize, it would add TSMC’s industry-leading strategies to a project that already combines capital and purchasing from Tesla and SpaceX with process technology from Intel. For now, the only public confirmation is Musk’s brief acknowledgment that talks are happening.
