TSMC Open to Working With Terafab But Must Control Plants

Taiwan Semiconductor Manufacturing Co. is in discussions about collaborating with Elon Musk’s Terafab project, though the Asian chipmaker stressed it must control its chip production in any alliance.

Asked if TSMC was joining Musk’s ambitious endeavor to get into chipmaking, Chief Executive Officer C. C. Wei said his company must operate its fabrication plants. Those comments followed the billionaire entrepreneur’s assertion last week that Taiwan’s largest company would at most only lease capacity rather than run manufacturing.

“We are still in discussion, let me say that,” Wei told analysts on a conference call. “But the fab has got to be run by TSMC.”

Based in Texas, the Terafab project is Musk’s effort to break into the business of fabricating chips, in service of his companies Tesla Inc. and SpaceXAI. Responding to speculation about TSMC potentially coming in to run operations, the Tesla chief said that his companies would be solely in charge at Terafab. Neither side has specified the parameters of any arrangement under discussion beyond confirming the talks.

US chipmaker Intel Corp. is helping Musk’s companies with developing the technology that’ll go inside the Terafab. The facility is expected to supply advanced semiconductors for the needs of Musk’s empire, across the Tesla carmaking and robotics business and the consolidated SpaceXAI that includes both spacefaring technology and the xAI group developing Grok. Musk has stressed that his companies would “build and run the fab.”

Read More: Elon Musk Rules Out Potential TSMC Role in Terafab Operations