Tesla (TSLA) CEO Elon Musk the company will likely need to build a “gigantic” semiconductor fabrication plant to support its growing ambitions in artificial intelligence and robotics.
“One of the things I’m trying to figure out is — how do we make enough chips?” Musk said during Tesla’s annual shareholder meeting on Thursday.
Currently, the EV maker relies on Taiwan Semiconductor Manufacturing Company (TSM) and Samsung Electronics (OTCPK:SSNLF) to produce its custom chip designs, with Intel (INTC) also under consideration as a future partner.
“But even when we extrapolate the best-case scenario for chip production from our suppliers, it’s still not enough,” he said.
Tesla would probably need to build a “gigantic” chip fab, which Musk described as a “Tesla terra fab.” “I can’t see any other way to get to the volume of chips that we’re looking for.”
Musk said Tesla’s proposed fab could start with a capacity of 100,000 wafer starts per month, eventually scaling up to 1 million. For comparison, TSMC’s annual capacity in 2024 was about 17 million wafers, or roughly 1.4 million per month.
While Tesla doesn’t yet fabricate its own chips, it has been designing custom silicon for autonomous driving for several years. The company currently outsources production of its new “AI5” chip, which Musk described as cheaper, more power-efficient, and optimized for Tesla’s AI software.
Musk also revealed that Tesla will begin production of its fully autonomous “Cybercab” — an electric vehicle with no pedals or steering wheel — in April.