Terafab (Source: SpaceX)
GRIMES COUNTY, Texas - SpaceX will build a massive, vertically integrated semiconductor fabrication plant in Grimes County, representing an initial capital investment of more than $16.8 billion and creating 3,000 jobs, Gov. Greg Abbott announced Thursday.
Grimes County is about 40 miles northwest of downtown Houston and directly east of College Station.
SpaceX announces major chip plant
By the numbers:
The project, dubbed the "Terafab," will span 100 million square feet and consolidate the chip manufacturing process, including logic, memory, and advanced packaging, under a single roof. The facility is designed to scale up chip production for the company's space and terrestrial artificial intelligence needs.
"Texas is where big ideas grow even bigger," Abbott said in a statement. "The first-of-its-kind Terafab facility will accelerate chip production in Texas at an unprecedented scale, create thousands of good-paying jobs in Grimes County, and expand economic opportunity for generations of Texans across Southeast Texas and beyond."
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To support the project, the state extended a $30 million grant from the Texas Enterprise Fund (TEF), a deal-closing incentive used to secure competitive corporate expansions. The Terafab also qualifies for economic incentives under the Texas Jobs, Energy, Technology, and Innovation (JETI) program, created by the Legislature in 2023 to draw large-scale industrial projects.
The expansion further anchors SpaceX's footprint in Texas, where it already operates its global headquarters and Starbase launch complex near Brownsville, as well as a Starlink manufacturing facility in Bastrop.
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Elon Musk, founder and CEO of SpaceX, said the facility aims to bring cutting-edge manufacturing back to the U.S. while powering the company's futuristic tech needs.
What they're saying:
"We’re now embarking on the most epic chip-building effort — combining logic, memory, and advanced packaging all under one roof — in Grimes County, Texas," Musk said. "The Terafab is bringing cutting-edge manufacturing to America, creating thousands of high-paying jobs in the Lone Star State, and enabling us to produce AI chips at scale for use on Earth and in space."
Local leaders welcomed the economic development, which will hire engineers, technicians, and plant operators. Grimes County Judge Joe Fauth III called the announcement a "generational change" for the area located northwest of Houston.
School districts serving the rural area have also moved to approve tax incentive agreements with project entity TeraFab AI, LLC under the state's JETI program. Leaders from both the Anderson-Shiro Consolidated Independent School District and the Iola Independent School District cited long-term educational and financial benefits for local students and schools.
Regional economic groups said they are preparing to bolster local infrastructure and workforce pipelines to accommodate the multi-billion-dollar buildout.
The Source: Information in this article is from Governor Greg Abbott's office and SpaceX.