Elon Musk is building Terafab, a vertically integrated semiconductor manufacturing plant in Texas, with an estimated investment of up to $20 billion. The project, a joint venture between Tesla, SpaceX, and xAI, uses High-NA EUV lithography machines from ASML to produce advanced AI and robotics chips.
The facility integrates the design, production, and packaging of semiconductor chips at a single site. The plant requires High-NA EUV lithography systems—the most advanced chip-making tools globally—produced exclusively by ASML.
ASML CEO Christophe Fouquet confirmed direct engagement with Musk, describing him as “very serious” regarding the project. Musk attended a closed-door ASML technology event virtually on June 6 to discuss the supply of these machines. High-NA EUV systems are essential for producing chips at nodes below 2nm, a requirement for next-generation AI and robotics hardware.
ASML stock surged 5.81% on June 8 following Musk’s endorsement and confirmation of his appearance at an upcoming Terafab conference. While some estimates place the investment at $20 billion, other reports suggest costs could reach $55 billion depending on the number of EUV clusters installed.
Internal friction has emerged. Reports indicate some ASML engineers threatened to boycott Musk’s virtual appearance. This follows internal discord at the Dutch firm, which recently announced approximately 1,700 job cuts.
Terafab is expected to move toward implementation over the coming years, though some industry reports suggest production timelines may shift to 2030 or 2031 due to the complexity of building advanced semiconductor fabs. Musk will make a formal appearance at an upcoming Terafab conference to detail the project’s integration and scaling goals.