# TeraFab (DD-016)

> TeraFab is the AI-chip complex that SpaceX and Tesla plan to build in Grimes County, Texas. It would make, package and test logic and memory chips under one roof. Texas announced the first phase on Aug 6, 2026: more than $16.8 billion, 3,000 jobs and a 100-million-square-foot facility. Tax filings sketch four phases worth up to about $119 billion, but the later phases aren't committed.

- Department: Tech
- First published: 2026-08-09
- Last updated: 2026-08-09
- Permalink: https://detailenjoyer.com/case/terafab/
- Author: Marcus Easterling (DetailEnjoyer), The Detail Department

## On the timeline

- **Aug. 6, 2026**: Texas announces SpaceX's Terafab chip plant in Grimes County
- **2026–28**: First-phase construction projected (planned)
- **2028**: Commercial operations expected to begin (planned)
- **2035–36**: Final (fourth) phase in state incentive filings, about $119.4 billion in all (planned)

Full timeline: https://detailenjoyer.com/timeline/?case=terafab

## Quick facts

- **DD-016-F01**: Terafab, SpaceX and Tesla's planned chip complex in Grimes County, Texas, would span 100 million square feet, with a first phase of more than $16.8 billion. _(Write-up · Exhibit C ($16.8 billion to start))_
- **DD-016-F02**: Terafab's tax filings sketch four phases worth up to about $119 billion, but only the $16.8 billion first phase has been announced. _(Write-up · Exhibit E (Up to $119 billion, if every phase gets built))_

## Write-up

Musk's planned chip plant would cover 100 million square feet. TeraFab, Grimes County, Texas. Phase 1: $16.8 billion.

1. **A chip plant in Grimes County**: On Aug 6, 2026, Texas Governor Greg Abbott announced that SpaceX will build Terafab, a vertically integrated semiconductor fabrication plant, in Grimes County, about 20 miles east of College Station, near Gibbons Creek Reservoir.
2. **Everything under one roof**: Terafab is meant to make, package and test advanced logic and memory chips in one place. In Musk's words, it combines 'logic, memory, and advanced packaging all under one roof'.
3. **$16.8 billion to start**: The first phase is a capital investment of more than $16.8 billion with 3,000 new jobs. The total is about $10.37 billion in the Anderson-Shiro district plus $6.43 billion in the Iola district. Texas added a $30 million Texas Enterprise Fund grant.
4. **100 million square feet**: The planned facility covers 100 million square feet. The chips are meant for Tesla's Optimus robots and Cybercabs and for SpaceX's space-based data centers.
5. **Up to $119 billion, if every phase gets built**: State tax-incentive filings describe four phases (2026–28, 2029–31, 2032–34, 2035–36) totalling about $119.4 billion. The applicant says it will decide on each later phase only after finishing the one before.
6. **Who's behind it**: The filings were made by TeraFab AI, LLC, a SpaceX-linked entity. ENR describes the project as led by affiliated companies including SpaceX, Tesla and xAI.
7. **Timeline**: First-phase construction is projected for 2026–28, with commercial operations expected to begin in 2028.

## Related case files

- [Data Centers (DD-029)](https://detailenjoyer.com/case/data-centers/): Making the chips that fill AI data centers.
- [Tesla Diner (DD-638)](https://detailenjoyer.com/case/tesla-diner/): Another Tesla-linked project

## Reel vs. record

- **Nuance**: '$119 billion' is a potential total across four phases in tax-incentive filings, not committed spending. SpaceX says it will decide on phases 2–4 only after each earlier phase is finished. [ENR source guide; KBTX; ENR]
- **Nuance**: the governor's announcement names SpaceX. Reuters reports SpaceX and Tesla, and the filings come from SpaceX-linked TeraFab AI, LLC, with ENR naming SpaceX, Tesla and xAI. 'SpaceX and Tesla's' is fair shorthand. [Texas Governor; Reuters; KBTX; ENR]
- **Confirmed**: Grimes County, vertical integration (logic, memory, packaging, testing), the $16.8B first phase and 100 million sq ft. 'More than $16.8 billion' is the official wording. [Texas Governor; Reuters]

## Video: TeraFab: Musk's Planned Chip Plant Would Cover 100 Million Square Feet

- Duration: 26.3 s · Published: 2026-08-09
- File: https://detailenjoyer.com/assets/videos/Db1UrREvlYW.mp4

### Transcript

DID YOU KNOW? SpaceX and Tesla's TeraFab is a planned semiconductor manufacturing complex in Grimes County, Texas, designed to vertically integrate chip production under one roof, including logic and memory fabrication, advanced packaging, and testing. The initial phase carries an announced $16.8 billion investment, and is planned to span roughly 100 million square feet, with the eventual project potentially reaching around $119 billion. NOW YOU KNOW!

## Questions & answers

**Q: In which Texas county is Terafab planned?**  
A: Terafab is planned for Grimes County, about 20 miles east of College Station. _(Source: Write-up · Exhibit A (A chip plant in Grimes County) · Governor Abbott Announces SpaceX Expansion in Grimes County (Office of the Texas Governor, Aug 6, 2026); SpaceX Records Fight Exposes $119B Terafab Buildout Plans (Engineering News-Record))_

**Q: How big is the first-phase investment announced for Terafab?**  
A: The first phase is a capital investment of more than $16.8 billion; $119B is the potential four-phase total. _(Source: Write-up · Exhibit C ($16.8 billion to start) · Governor Abbott Announces SpaceX Expansion in Grimes County (Office of the Texas Governor, Aug 6, 2026); SpaceX Records Fight Exposes $119B Terafab Buildout Plans (Engineering News-Record); Terafab: Texas JETI primary-source document guide (ENR, Oct 2026))_

**Q: How large is the planned Terafab facility?**  
A: Texas describes a 100-million-square-foot facility. _(Source: Write-up · Exhibit D (100 million square feet) · Governor Abbott Announces SpaceX Expansion in Grimes County (Office of the Texas Governor, Aug 6, 2026); SpaceX, Tesla to initially spend $16.8 billion on Terafab chip plant in Texas (Reuters, Aug 6, 2026))_

**Q: What does the ~$119 billion figure represent?**  
A: It's the four-phase total in tax filings; later phases depend on decisions after each earlier phase. _(Source: Write-up · Exhibit E (Up to $119 billion, if every phase gets built) · Terafab: Texas JETI primary-source document guide (ENR, Oct 2026); Texas Comptroller greenlights all 8 Terafab tax break applications (KBTX, Jun 18, 2026); SpaceX Records Fight Exposes $119B Terafab Buildout Plans (Engineering News-Record))_

**Q: When are Terafab's commercial operations expected to begin?**  
A: First-phase construction runs 2026–28, with operations expected in 2028. _(Source: Write-up · Exhibit G (Timeline) · SpaceX Records Fight Exposes $119B Terafab Buildout Plans (Engineering News-Record); Terafab: Texas JETI primary-source document guide (ENR, Oct 2026))_

## Sources

- [Governor Abbott Announces SpaceX Expansion in Grimes County (Office of the Texas Governor, Aug 6, 2026)](https://gov.texas.gov/news/post/governor-abbott-announces-spacex-expansion-in-grimes-county)
- [SpaceX, Tesla to initially spend $16.8 billion on Terafab chip plant in Texas (Reuters, Aug 6, 2026)](https://www.reuters.com/business/media-telecom/spacex-says-terafab-be-built-texas-with-initial-investment-168-billion-2026-08-06/)
- [SpaceX Records Fight Exposes $119B Terafab Buildout Plans (Engineering News-Record)](https://www.enr.com/articles/63809-spacex-records-fight-exposes-119b-terafab-buildout-plans)
- [Terafab: Texas JETI primary-source document guide (ENR, Oct 2026)](https://www.enr.com/ext/resources/2026/10/07/ENR_Texas_JETI_Terafab_Source_Guide.pdf)
- [Texas Comptroller greenlights all 8 Terafab tax break applications (KBTX, Jun 18, 2026)](https://www.kbtx.com/2026/06/18/texas-comptroller-greenlights-all-8-terafab-tax-break-applications-heres-what-that-means/)

## Cite this case file

Easterling, Marcus. "TeraFab." The Detail Department (DetailEnjoyer), case file DD-016, last updated Aug 9, 2026. https://detailenjoyer.com/case/terafab/