Intel CEO Lip-Bu Tan said on Oct. 7 that Intel will continue to participate in Elon Musk’s Terafab chip manufacturing project, according to Bloomberg. Soon after, Musk said on X that the fab would be built and operated by his own side, and that Taiwan Semiconductor Manufacturing Co. (TSMC) could at most sublease part of the facility.
The comments came one week after Musk confirmed that he had discussed possible cooperation with TSMC. That has put the question of who would control any future partnership back in focus.
Tan confirms Intel is still in the project
Bloomberg said Tan made the remarks in Tokyo before an event marking Intel’s 50th anniversary in Japan. Intel joined the Terafab project in April this year, and Tan’s latest comments amount to a public confirmation that the company remains involved.
He did not spell out Intel’s exact role in Terafab, the scope of any cooperation, or the project timeline.
Musk rejects the idea of TSMC running the fab
Last week, Musk replied to a post saying TSMC was studying cooperation with Terafab by writing, 「still just discussions.」 The report said TSMC’s entry could challenge Intel’s standing in the project because Musk is still evaluating partners.
Tesla long-term investor and entrepreneur Herbert Ong later posted his interpretation, saying the situation looked like a repeat of Musk’s 「battery playbook」: building at a scale others would not initially commit to, leaving suppliers little room to stay out. Ong said Intel was already involved and Samsung was also in talks. He added that the most likely structure, in his view, would be for TSMC to own and operate the fab, while SpaceX would participate through investment or chip purchase commitments.
Ong also relayed comments attributed to TSMC Chairman C.C. Wei, saying a new fab would take 2 to 3 years to build, followed by another 1 to 2 years to ramp.
Musk directly rejected that scenario. He wrote, 「No, we will build and operate this fab, no question.」 He then added that if TSMC was interested, it might be able to sublease part of Terafab, 「and that’s it.」
Market views diverge on whether a deal can happen
Views on a possible TSMC-Musk partnership are not aligned. In a report dated Oct. 5, JPMorgan said that if cooperation moves forward, control over process technology and fab operations would likely remain with TSMC. The bank said the structure could resemble joint ventures such as JSMC and ESMC, with TSMC holding a majority stake.
Independent semiconductor analyst Alex took a different view and said the deal may be difficult to complete. His reasons included that TSMC would not license advanced process technology with attached restrictions, that TSMC has historically remained the majority shareholder in overseas joint ventures, and that advanced process technology in Taiwan is treated as a tightly controlled national secret.
Key deal terms remain undisclosed
So far, no public information has been released on the contract structure, investment size, or capacity allocation. JPMorgan expects TSMC would hold the lead if a partnership is reached. Musk, for his part, has said clearly that he wants his own side to control the project. That gap is now out in the open.
Intel’s statement that it will 「continue participating」 means the company could still end up serving as a technology partner under the model Musk described, where the fab is owned and operated by his side. What Intel would actually do, however, remains unclear. The next point to watch is whether Intel, TSMC, and Tesla provide more detail, and how Musk defines 「sublease」 in practical terms.