Tesla has launched Terafab, the world’s largest semiconductor manufacturing facility, designed to produce chips with an annual compute capacity of one terawatt. The announcement came on March 22, 2026, highlighting collaboration with SpaceX and xAI to build a factory combining logic chips, memory, and advanced packaging technologies under one roof.
The Terafab project aims to supply the surging demand for microchips needed to power both terrestrial and orbital technologies. Tesla intends to support the deployment of 100 million tons of solar-powered infrastructure in orbit each year. This encompasses satellites equipped with artificial intelligence and millions of Tesla Optimus robots, each requiring massive computational resources.
The vertical integration at Terafab marks a strategic move far beyond typical chip fabrication. Tesla predicts demand for chips will skyrocket to 100-200 gigawatts worth of compute just for Optimus robots, plus an extraordinary one terawatt for its orbital AI systems, dwarfing current global semiconductor manufacturing capacity. This ambition vastly exceeds projected chip manufacturing volumes planned through 2030.
By calling Terafab a ”bridge to the future among the stars,” Tesla positions this factory as a key enabler of humanity’s multi-planet expansion. In a rare preview, SpaceX revealed images of satellites meant for orbital data centers linked to the Terafab initiative-a bold push to establish AI-powered infrastructure in space.