Musk argues the semiconductor industry isn’t scaling fast enough to meet his companies’ growing demand for AI and robotics, so he sees building his own supply as necessary. His long-term goal is to support massive computing capacity—eventually reaching a terawatt annually—though he hasn’t provided a timeline.
Despite widespread concern about chip shortages, it’s unusual for companies to build their own fabs due to the enormous cost and complexity. Musk acknowledged existing suppliers can’t fully meet Tesla’s future needs as it shifts toward AI-driven products.
I wonder if it might make more sense for TSLA to simply purchase a portion of TSMC/ASML/etc. thus guaranteeing supply over building their own dedicated supply.
I mean, TSLA doesn’t have their tires integrated but they are just a necessary for all makes and models.
Seems like a very expensive solution to the problem.
TSMC is by far the leader in advanced chip manufacturing. Samsung and Intel are lagging. But it isn’t because they are dumb or lazy. It is because it is an extremely difficult industry.
Around COVID and the CHIPS Act there was lots of discussion about onshoring advanced chip manufacturing. TSMC anticipates they will begin making 2 nm chips in their fabs in Arizona by 2029, and TSMC is the best in the world. Musks says Tesla/SpaceX begin making 2 nm chips in 2027, starting from scratch today.
They won’t make 2% of their goal for in-house, 2nm AI chips. (I would bet 0%).
They could maybe partner, if anyone would work with or for them.
Remember 20 million cars annually?
They are closer to 1 million annually.
The list of broken dreams like this is so very long.
In September 2020, [pretend engineer] stood on a stage and promised a revolution in battery technology with the 4680 cell. Tesla was going to ramp to 10 GWh within a year and eventually reach 3 TWh by 2030 — enough for 20 million cars annually. The dry electrode process was going to cut costs by 50%.
Five and a half years later, the 4680 program has been a disappointment. Tesla’s own top battery supplier said [pretend engineer] doesn’t know how to make battery cells. The dry electrode process needed six or seven revisions. It took years longer than promised, and the 3 TWh target is a distant fantasy.
Tesla is estimated to be at only about 2% of its original cell manufacturing volume goal.