Terafab, the semiconductor project backed by Elon Musk’s Tesla, SpaceX and xAI, has turned to South Korea for help building its supply chain. Its representatives met with about 10 Korean companies at SEMICON West, held October 13 to 15, 2026.
The goal is enormous. Terafab plans to stand up a US chip manufacturing operation capable of producing 1 million wafers per month within 10 years.
What came out of the Korea meetings
The SEMICON West talks produced numerous non-disclosure agreements. Discussions centered on advanced materials and components needed for semiconductor production.
HPSP is supplying one high-pressure hydrogen annealing system for Terafab’s research and development line.
Hanmi Semiconductor, meanwhile, has received orders for advanced packaging equipment.
The Texas footprint and the price tag
Terafab’s flagship facility will sit at Tesla’s Giga Texas in Austin. Prototype fabrication work there began earlier in 2026.
A larger semiconductor fab is planned for the former Gibbons Creek site in Grimes County, Texas. The first phase of that project carries a projected cost of approximately $16.8 billion, a figure announced in August 2026.
The full buildout could reach up to $119 billion.
Intel became a strategic development partner in April 2026, working on design and fabrication with its 14A process technology.
Talks with TSMC are also continuing.
Why Musk’s companies want their own chips
The project is designed to feed semiconductor demand across AI, robotics and space technology. Those are the core businesses of xAI, Tesla and SpaceX, respectively. The stated aim is a self-sufficient supply chain that reduces reliance on outside foundries.
What this means
For Korean equipment makers, Terafab represents a potentially large new customer outside the usual roster of established chipmakers. HPSP and Hanmi Semiconductor have early orders, and the companies that signed NDAs could follow if talks progress.
The Intel partnership and ongoing TSMC talks are worth watching closely. How much Terafab leans on outside process technology will reveal how self-sufficient this supply chain actually ends up being.
Also watch whether more Korean suppliers convert NDAs into purchase orders. Signed contracts, not meeting counts, will show how quickly the Texas fabs are moving from blueprint to production floor.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.