Terafab has officially broken ground, with the crews beginning to clear land and trees in August for the first phase of the semiconductor campus SpaceX, Tesla and xAI are building near Gibbons Creek Reservoir outside Iola. Terafab is the factory Elon Musk has claimed as the world's largest chip-manufacturing facility, planned on more than 6,000 acres of ranch and timber country in Grimes County, midway between Houston and College Station.
The plan calls for a footprint of 100 million square feet, more than twice the size of Tesla's Giga Texas campus outside Austin, with logic, memory and advanced chip packaging under a single roof, the vertically integrated model that set it apart when it was first announced in August . The build-out runs in four phases, and state incentive filings value the full program at up to $119 billion.
Phase one, the piece now being cleared on the western side near the reservoir, carries a capital investment of more than $16.8 billion and is expected to create 3,000 jobs.
The first customers are Starlink satellites, SpaceX's planned space-based data centers, and Tesla's Optimus robots and self-driving vehicles, with Intel as the foundry partner.
Industrial water will come from Gibbons Creek Reservoir, not local groundwater, with a closed-loop recycling system and on-site wastewater treatment behind it. Power will be self-supplied too, with SpaceX planning on-site natural gas generation paired with large battery arrays, enough to carry the campus's base load without the local grid.
The campus does not stand alone in the companies' pipeline. A precursor research fab is already rising on the north campus of Giga Texas, working out the process before it scales to Grimes County.
Formal construction begins December 1, 2026, on the western side of the site, and the remaining three phases follow across the rest of the 6,000 acres. Completion is set for the end of 2028.