SpaceX has announced plans to construct a semiconductor plant in Grimes County, with an estimated initial investment exceeding $16.8 billion and the potential to create 3,000 jobs. Governor Greg Abbott and SpaceX CEO Elon Musk revealed the project, named Terafab, which will be located near Iola.
The facility is designed to be one of the largest manufacturing buildings globally, covering 100 million square feet. It will integrate chip design, logic, memory, and advanced packaging under one roof, streamlining production processes that are typically fragmented across various suppliers.
The chips produced will be utilized in Tesla's Optimus humanoid robots and Cybercab driverless vehicles, as well as processors for SpaceX's satellite-based data centers. Abbott remarked that the Terafab facility represents a significant advancement in Texas's chip production capabilities.
To support this project, the state has allocated a $30 million grant from the Texas Enterprise Fund. Additionally, both Grimes County school districts have endorsed the project, with Iola ISD approving an agreement with TeraFab AI, LLC. The project also qualifies for the Jobs, Energy, Technology and Innovation program, which includes school-tax incentives.
While the state and SpaceX cite the initial phase investment at $16.8 billion, a SpaceX filing from May indicated an initial investment of $55 billion, raising questions about the figures presented. No construction timeline has been disclosed yet.
