SpaceX weighs Terafab chip factory in Texas

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SpaceX plans Texas Terafab chip factory and IPO control structure, Reuters excerpts describe supervoting shares and arbitration clauses, public investors buy in with limited recourse

SpaceX is weighing a semiconductor manufacturing project in Grimes County Texas with an initial price tag of about $55 billion and a total buildout that could reach $119 billion, according to TechCrunch. The proposed facility dubbed “Terafab” is described as a multi‑phase vertically integrated chip and advanced computing plant, with Tesla resources and Intel involvement cited in the reporting.

The scale is aimed at a bottleneck Musk has been complaining about for years: access to chips for AI training, satellites and autonomy systems. TechCrunch reports that the chips are intended for AI servers, SpaceX satellites and Musk’s broader computing ambitions, including a proposed SpaceX data‑center-in-space concept tied to xAI’s demand for training capacity. Musk has framed the project as a way to stop relying on outside suppliers that ration capacity when demand spikes and geopolitics constricts export flows.

What makes the Terafab plan unusual is not only the industrial ambition but the governance wrapper being prepared around it. Ars Technica, citing Reuters’ review of excerpts from SpaceX’s confidential IPO registration statement, reports that the company’s public listing is structured to keep Elon Musk in control while sharply limiting shareholder leverage. The filing reportedly combines supervoting shares with mandatory arbitration, tighter limits on shareholder proposals and a Texas corporate law framework that reduces the usual avenues for investor challenges. Reuters’ excerpts describe a company where Musk would retain majority voting power after the IPO and where the only person who can fire the CEO would be the CEO.

The effect is to separate capital raising from accountability in a way that is hard to miss. Public shareholders would provide liquidity and funding while waiving jury trials and class actions and being pushed into arbitration for disputes, according to the Reuters excerpts cited by Ars. As a “controlled company” under securities rules, SpaceX would also be able to opt out of some independence requirements for key board committees.

That structure matters because chipmaking is a business where delays, yield problems and cost overruns are common even for incumbents with decades of process experience. A $119 billion multi‑phase fab effort implies long lead times, heavy local infrastructure needs and a workforce pipeline that Texas will compete to supply. If the project stumbles, the usual tools for investors to force changes—board turnover, governance proposals, litigation discovery—are exactly the tools the IPO terms are designed to blunt.

SpaceX has not publicly released the full IPO filing, which is being pursued confidentially, meaning outside scrutiny of financial assumptions and risk disclosures will arrive late in the process. For now, the most concrete numbers in circulation are the ones attached to Terafab’s potential cost and the voting math described in Reuters excerpts: Musk currently holds 42.5% of SpaceX equity and 83.8% of its voting control, and the IPO is designed to keep him above 50% voting power.

In Grimes County, the pitch is a chip plant measured in tens of billions. On Wall Street, the offer is a public company where the shareholders’ main guaranteed right is to pay in.