Intel’s Lip-Bu Tan Backs Musk’s TeraFab, Flags AI Chip Supply-Chain Strains

Elon Musk announced on March 22, 2026, that Tesla and SpaceX would develop TeraFab in Austin, Texas, with an investment of about $20 billion. The project would bring logic chips, memory and advanced packaging together at a single site, targeting annual production capacity of 1 terawatt of AI computing power. The facility is central to securing an independent chip supply for AI, robotics and space computing, and represents a major test of Intel’s foundry transformation.

In an interview published on June 20, 2026, Intel CEO Lip-Bu Tan said the company would support Musk’s TeraFab with its Intel 14A process. He warned that AI expansion was being constrained by insufficient power, shortages of helium used in chipmaking, and tight supplies of memory, CPUs and GPUs. Expanding capacity through new plants would take years, and the costs could be passed on to customers. Tan also said AMD CEO Lisa Su had sought his career advice before joining AMD.