Elon Musk claims that his ambitious chip factory project, Terafab, is “progressing quickly” and will be ready to produce its first chip by May or June 2027, with plans to go to scale by the third quarter of 2028

That’s a rather unusual timeline, but one in keeping with Musk’s penchant for outlandish plans and overpromising on delivery date projections. Musk announced the giant chip factory project in Austin, Texas back in March with claims that it will produce chips for both terrestrial and space-based use cases. But chip factories are notoriously tough and costly to build, especially in the United States instead of somewhere like Taiwan that has established expertise. Making the factory operational alone can often take several years. But Musk promises a more streamlined timeline for his fab.

“We’ll begin commissioning machinery in the first half of next year, and hopefully if things go well, we’ll make our first test chip, just to see if we can make any chip at all, around May or June,” Musk said. “But real production would be late ’28, which is lightning fast by fab standards.”

The project is a joint venture between two of Musk’s companies, SpaceX and Tesla, which are also actively discussing a merger, the billionaire revealed in the former’s earnings call yesterday. Turns out, the companies have yet to decide how to split up the costs of Terafab.

“We got to figure out like what the sort of relative split is between SpaceX and Tesla in terms of who pays for what at Terafab, but it’s not going to be less than tens of billions in capital equipment through early 2028, and then it will probably be north of 100 billion long term,” Musk said on Tesla’s earnings call.

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