Musk Teases Tesla AI Terafab to Leapfrog Nvidia Chip Shortage
By Reuters | 14 Mar, 2026

Tesla's future in autonomous driving appears tied to a massive AI chip fab project that will likely involve Intel, TSMC and Samsung and launch in 7 days.

Tesla CEO Elon Musk said on Saturday that the company's Terafab project to make artificial intelligence chips will launch in seven days. 

Musk had said last year that Tesla probably will have to build "a gigantic chip fab" to make artificial intelligence chips. 

Tesla is designing its fifth-generation AI chip to power its autonomous ambitions, and Musk at the company's annual meeting last year laid out potential manufacturing plans. 

Musk had said at the time that the EV maker could work with Intel and said, "You know, maybe we'll, we'll do something with Intel."

"We haven't signed any deal, but it's probably worth having discussions with Intel," he had said. 

Tesla did not immediately respond to a Reuters request seeking more details about the project. 

Musk has teased the AI5 chip before and reiterated that Tesla was also partnering with Taiwan's TSMC and South Korea's Samsung. The AI chips power Tesla's autonomous driving systems, including the Full Self-Driving software. 

"Even when we extrapolate the best-case scenario for chip production from our suppliers, it's still not enough," Musk said last year, at Tesla's AGM. 

"So I think we may have to do a Tesla terafab. It's like giga but way bigger. I can't see any other way to get to the volume of chips that we're looking for. So I think we're probably going to have to build a gigantic chip fab. It's got to be done," he said.

(Reporting by Akanksha Khushi in Bengaluru, Editing by Louise Heavens)