Elon Musk's SpaceX has proposed an initial investment of $55 billion, aiming to establish a semiconductor manufacturing facility, called Terafab, in Texas, as per filing made public today.
The facility, a joint project with Tesla, comes as the tech billionaire is looking to secure in-house access to the cutting-edge AI-powered chips, though analysts say the scale of capacity he has highlighted would expectedly need greater investment.
Moreover, SpaceX is currently targeting a June IPO that may raise the company's valuation at nearly $1.75 trillion.
Notably, Musk has been heavily spending on AI across his companies, with SpaceX acquiring his startup xAI earlier this year in an agreement, primarily focused on building space-based data centres for AI processing.
The Terafab project will be a multi-phase chip fabrication and the cutting-edge computing complex, aiming to boost domestic semiconductor production across the US.
SpaceX estimates total investment is likely to increase $119 billion after completing the phases.
The facility is planned in Grimes County within the designated reinvestment zone, where local officials are likely to consider a property tax abatement deal at a June meeting.
The proposed facility could assist in minimising reliance on third party suppliers such as Samsung and Taiwan Semiconductor Manufacturing.
This investment is a part of significant plans to expand domestic semiconductor manufacturing amid geopolitical tensions and supply chain risks.
