Intel signs on to Elon Musk’s Terafab chip project

Intel will join SpaceX and Tesla in an effort to build a new U.S. semiconductor factory in Texas, but the scope of its contribution is unclear.

“Our ability to design, manufacture and package ultra-high performance chips at scale will help accelerate Terafab’s goal of producing 1 TW of compute per year to power future AI and robotics advances,” Intel said in a company post about the X. Intel has not released any further information.

In March, Elon Musk announced a partnership between two of his technology companies to develop chips for AI computing, satellites and space data centers that SpaceX is considering, and to support the potential of self-driving Tesla cars and robots.

But building a chip factory is one of the most difficult and expensive of a company’s infrastructure projects, typically requiring years and more than $20 billion to build a facility with huge clean rooms where thousands of ultra-precision machines sculpt silicon. It was not clear how SpaceX and Tesla, two companies with no experience in the field, could work together to execute the project efficiently.

Now we have a better idea that Intel will do it. The company is looking for large-scale key customers to support its foundry business, and currently has two. Still, even if investors thought Terafab would be a greenfield approach based on SpaceX and Tesla’s unique approach to engineering, that may not work out.

Intel, once a major U.S. silicon producer, watched rivals Nvidia and AMD take the lead in developing advanced processors and adopt a “fabless” business model in which chip designers outsourced semiconductor manufacturing. Intel’s stock price rose more than 3% on today’s news. As of 2 p.m. ET, the stock was trading at $52.28, about 2.9% above its opening price.

Intel declined to comment on the partnership, while SpaceX did not respond to TechCrunch’s inquiries.