Catenaa, Monday, October 05, 2026- Intel stock fell on Monday after Tesla CEO said that TSMC would support his Terafab chip manufacturing facility in Texas.
Intel Stock fell by 2% on Monday, while TSMC stock rose by 2.5%, as some viewed Musk’s confirmation as a sign of competition for Intel, according to MarketWatch.
Terafab is a joint venture launched by Tesla and SpaceX to manufacture chips for both companies in a facility in Texas, and in April Intel became the first to offer support for the venture.
Tesla and SpaceX announced the project with an initial investment of $16.8 billion and a planned workforce of at least 3,000 people.
SpaceX said the chips produced there will be used in Tesla’s Optimus robots and Cybercabs, as well as in space-based data centers the company is developing.
According to SpaceX, the total spending across all phases could reach as much as $119 billion.
MarketWatch report said that Oppenheimer analyst Rick Schafer wrote in a note that one option has TSMC owning and running a fab that serves only Tesla, SpaceX and xAI, while SpaceX invests or commits to volume.
In response to a separate X post, Musk said that any chips from TSMC would likely be in addition to those supplied by Intel.
TSMC’s support for the Terafab venture comes as the chipmaker is looking at ways to expand further in the US and get into more US chip deals
Quartz said that TSMC is considering construction of a new Texas campus separate from the $265 billion it has already committed to an Arizona campus, with each fabrication plant carrying a price tag of at least $20 billion.
Meanwhile, Electrek said that customers based in North America account for more than 75% of TSMC’s wafer revenue this year. TSMC already handles a portion of Tesla’s chip manufacturing needs, with Tesla having signed a separate $16.5 billion deal with Samsung for its next-generation AI6 chip.
During the launch of the Terafab venture, Musk said that SpaceX and Tesla would need as many as 200 billion AI chips per year.
MarketWatch said that Tesla already works with Micron Technology, Samsung Electronics and TSMC. The latter two will mass-produce Tesla’s next-generation AI5 chips next year in Arizona and Texas facilities.
“Musk has said Terafab will be a one-of-a-kind facility that can make memory chips, logic chips and packaging used across his companies, such as for humanoid robots, satellites and data centers,” the MarketWatch report said.
