April 23, 2026 /SemiMedia/ — Tesla plans to invest about $3 billion to build a semiconductor research facility in Texas, as part of early steps toward its broader chip manufacturing plans, Chief Executive Elon Musk said.

The site will be located at Tesla’s Giga Texas complex and will run at a small scale, producing only a few thousand wafers per month. The goal is to test new designs and process technology, rather than mass production.

Musk said a larger effort, known as “Terafab,” is also under development. SpaceX is expected to lead the early phase, with Tesla and AI company xAI involved. The project aims to secure enough chip supply for Musk’s companies, especially for AI-related use.

Intel has joined as a partner and is expected to provide support in design, manufacturing, and packaging. Musk said the plan is to use Intel’s 14A process, though the technology is still under development and not yet widely used.

He did not say whether Tesla would rely on Intel’s own fabs or use its process in another way. Musk added that the timing would depend on when the technology is ready for stable production.

The $3 billion budget is much lower than the cost of a leading-edge fab, which can run into tens of billions of dollars. The Texas facility is closer to a pilot line, a type of site often used in the industry to test new processes before scaling up.

Musk also noted that any joint work between Tesla and SpaceX would need approval from both companies’ boards.