Tesla and SpaceX are preparing a multibillion-dollar chip manufacturing project, while Tesla targets future deliveries of Optimus humanoid robots and plans to expand its Cybercab service to additional United States cities.
Elon Musk has outlined an ambitious timeline for Terafab, a proposed semiconductor manufacturing facility in Austin, Texas, with the first test chip expected around May or June 2027 and large-scale production targeted for the third quarter of 2028.
The project, being developed jointly by Musk’s Tesla and SpaceX, is intended to produce chips for applications on Earth and in space. However, the companies are still working out how to divide the project’s substantial costs.
According to UNN, citing Gizmodo, Musk provided the latest timeline during a discussion of the companies’ plans, although the proposed schedule remains subject to the challenges associated with establishing a semiconductor manufacturing operation.
Gizmodo described the projected deadlines as “fairly unusual timelines, but they fit Musk’s penchant for strange plans and inflated promises regarding delivery-date forecasts.”
Musk announced Terafab in March, presenting it as a major step towards securing the advanced computing hardware needed for his companies’ future ambitions.
The facility is expected to require significant investment and specialised equipment. Semiconductor factories are complex industrial projects that can take years to construct, equip and bring into commercial operation, making the proposed schedule particularly demanding.
“We will begin commissioning the equipment in the first half of next year, and hopefully, if everything goes well, we will produce our first test chip, just to see whether we can produce any chip at all, around May or June. But actual production will begin at the end of 2028, which is lightning-fast by chip-factory standards”
Musk said.
While the initial test chip is targeted for the middle of 2027, the wider production schedule points to the second half of 2028. The milestones will depend on equipment installation, testing and the successful establishment of the manufacturing process.
Terafab investment could exceed $100 billion
The scale of the project remains a central issue as Tesla and SpaceX consider how to finance the facility.
Musk said the companies had yet to determine their respective financial responsibilities, with the investment expected to run into tens of billions of dollars before potentially expanding considerably over time.
“We need to figure out the relative allocation between SpaceX and Tesla in terms of who pays for what at Terafab, but it will not be less than tens of billions in capital equipment by the beginning of 2028, and then it will probably be more than $100 billion in the long term,” Musk said during Tesla’s earnings call.
The investment would make Terafab one of the most capital-intensive projects associated with Musk’s technology businesses.
The facility is also intended to support Tesla’s artificial intelligence and robotics ambitions, as well as SpaceX’s requirements for computing hardware used in space-related applications.
Musk has described the proposed factory as an “incredibly important asset, if not a necessary asset” for expanding production of Optimus, Tesla’s humanoid robot.
However, the proposed merger of Tesla and SpaceX remains under consideration, and the two companies have not announced a final decision to combine their operations.
Tesla advances Optimus production plans
Tesla is also working towards expanding production of Optimus, a humanoid robot designed to carry out physical tasks in industrial and other environments.
Musk said initial production had started “on a high-volume line” at the company’s Fremont facility in California.
Despite that progress, Tesla still expects to require “probably at least a year, perhaps a little more” to reach its previously stated target of manufacturing approximately 20,000 robots per week.
The company’s timeline also depends on resolving engineering challenges, particularly those involving the robots’ hands and electromechanical systems.
Musk said he expected these issues to be resolved by the end of 2027, when Tesla anticipates beginning deliveries to customers.
The initial market is expected to include industrial businesses seeking machines capable of carrying out hazardous or repetitive work.
Musk said the first customers would focus on “dangerous, repetitive tasks, things that people really don’t want to do… such as working around the clock,”
The proposed applications reflect Tesla’s ambition to position Optimus as a source of automated labour for tasks that are difficult, monotonous or require continuous operation.
Nevertheless, the delivery timeline and production targets remain forward-looking commitments rather than evidence that the robot has achieved large-scale commercial deployment.
Cybercab expansion planned for more US cities
Tesla’s robotaxi programme is another part of the company’s broader push into autonomous transportation.
The two-seat Cybercab is expected to become available for customer purchase by the end of 2026, according to Tesla Vice President of Automotive Engineering Lars Moravy.
Musk, however, indicated that Tesla intends to retain ownership of most vehicles operating within its robotaxi network.
He said the “vast majority” of Cybercabs would be owned by Tesla and operated through a “transportation as a service” model, under which customers would pay to use the vehicles rather than own them.
The company’s robotaxi service is currently operating in Austin, Texas, and executives have outlined plans to introduce it in additional cities before the end of 2026.
Dallas is expected to be the next market, with a launch targeted for November.
The expansion will be an important test of Tesla’s ability to extend its autonomous transportation business beyond its existing operating area.
Musk has expressed confidence in the long-term potential of the service, telling analysts:
“I think Tesla will ultimately perform the majority of passenger miles on Earth in any country where it is allowed to operate freely, and you can come back and look at this forecast,”
The statement reflects Musk’s expectations for Tesla’s future role in passenger transportation, although achieving that scale would depend on technological development, regulatory approval and the company’s ability to expand its services.
Potential Tesla-SpaceX merger could reshape Musk’s wealth
Alongside the manufacturing and product announcements, a possible merger between Tesla and SpaceX could have substantial financial implications for Musk.
The companies are examining the possibility of combining their operations, but neither has confirmed that a transaction will proceed.
According to Bloomberg’s calculations, a merger could potentially accelerate Musk’s access to Tesla shares worth more than $110 billion under a compensation arrangement established in 2018.
That package covers approximately 286 million shares. Bloomberg does not currently count the full value of those shares towards Musk’s wealth because his rights to the securities remain subject to the applicable conditions.
If a merger triggers a change of control at Tesla, the terms of the compensation package could allow Musk to obtain the shares earlier than originally scheduled, potentially before the current 2028 timeline.
Certain transaction structures could also affect when he is permitted to sell the shares.
Musk has confirmed that Tesla and SpaceX have established special committees to examine the potential combination. He has argued that closer cooperation between the companies could deliver significant benefits.
Another possible source of financial gain is Musk’s 2025 compensation package, whose maximum potential value could approach $1 trillion.
Depending on the terms of a merger, some of that compensation could potentially be awarded without requiring Musk to satisfy certain operating targets originally associated with the package.
Bloomberg estimates that if Tesla were valued at $2 trillion in a merger, Musk could potentially obtain rights to additional shares with a net value exceeding $6 billion.
These figures are contingent on the structure and terms of a possible transaction. They do not represent confirmed payments or gains, and the companies have not announced a completed merger.
Major ambitions face execution challenges
Terafab, Optimus and Cybercab represent different parts of Musk’s broader strategy to expand his businesses into semiconductor manufacturing, robotics and autonomous transportation.
The proposed chip facility is intended to help secure computing capacity for future technologies, while humanoid robots could eventually automate industrial tasks and robotaxis could form the basis of a wider transportation service.
However, each initiative faces significant execution challenges.
Terafab must progress from equipment installation and test-chip production to reliable commercial manufacturing. Optimus must overcome outstanding engineering problems and demonstrate that it can be produced at the volumes Tesla has outlined. Cybercab’s expansion will depend on the development and regulatory acceptance of its autonomous driving capabilities.
The potential Tesla-SpaceX merger adds another layer of uncertainty, as the companies continue to examine the financial and operational implications of combining their businesses.
For now, the announced dates and financial projections offer a picture of Musk’s intended direction rather than guaranteed outcomes. Whether the projects meet their ambitious schedules will depend on engineering progress, capital investment, manufacturing execution and regulatory conditions.
