Tesla CEO Elon Musk announced that the company plans to use Intel’s next-generation 14A manufacturing process to produce chips for its ambitious Terafab project, a large-scale AI chip manufacturing initiative.
The 14A process—considered a cutting-edge, next-generation semiconductor node—is expected to play a central role in powering Tesla’s future AI ambitions, including applications in robotics, autonomous driving, and data centers. Musk stated, “14A seems like the right move,” adding that the technology is likely to be mature and ready for large-scale deployment by the time Terafab becomes operational.
The Terafab project is a joint effort involving Tesla, SpaceX, and xAI, aimed at building a fully integrated chip manufacturing ecosystem in the United States. The facility is expected to produce semiconductors specifically designed for artificial intelligence workloads, with long-term goals of achieving massive computing capacity at scale.
For Intel, the deal represents a significant milestone, as Tesla is expected to become one of the first major external customers for its 14A technology. This is particularly important for Intel’s contract manufacturing ambitions, as it seeks to compete with dominant players like TSMC in advanced chip production.
The announcement also had an immediate market impact, with Intel’s shares rising in extended trading following Musk’s remarks, reflecting increased investor confidence in the company’s next-generation chipmaking capabilities.
Overall, the collaboration highlights a broader industry trend where major technology companies are investing heavily in custom chip development and manufacturing to secure long-term control over AI infrastructure and reduce reliance on third-party suppliers.
