SpaceX plans chip factory in Grimes County, Texas
Billed as the “world’s largest building,” the latest addition to SpaceX’s burgeoning Texas real estate portfolio is a new 100-million-square-foot semiconductor factory in Grimes County. A project architect hasn’t been named.
The planned Terafab facility is set to bring chip fabrication, memory, and advanced packaging together under one roof, creating what the company describes as a vertically integrated manufacturing operation for its expanding fleet of spacecraft, satellites, and AI systems.
Texas Governor Greg Abbot announced the project this month. The state is extending a $30 million Texas Enterprise Fund grant to SpaceX, while the project qualifies for incentives through Texas’s Jobs, Energy, Technology, and Innovation program.
At 100 million square feet, the project would be roughly 100 times the size of the company’s planned one-million-square-foot semiconductor expansion in Bastrop, Texas.
Rather than distributing different stages of chip production among separate facilities and suppliers, SpaceX says the new Grimes County plant will combine “logic, memory, and advanced packaging,” in a single complex.
Elon Musk called it an, “epic chip-building effort,” framing the facility as a way to produce AI chips at scale for applications on Earth and in space.
The project arrives as SpaceX’s increasingly large physical presence in Texas, and AI more broadly, prompt questions about land, water, infrastructure, and environmental impact.
Residents and environmental activists in South Texas raised concerns about the company’s proposed expansion around Starbase, per NPR. The EPA found SpaceX violated the Clean Water Act in 2024 after releasing pollutants into bodies of water in South Texas.
Starbase, the company’s launch and manufacturing complex on the Gulf Coast, was incorporated as a city in 2025 after SpaceX employees voted in favor of incorporation.
The city encompasses much of the company’s South Texas operations, and SpaceX has proposed annexing roughly 7,100 additional acres.
Questions remain surrounding the expansion’s effects on private land, road access, and the surrounding environment, as well as close ties to SpaceX and the newly formed city government.
The marriage between Musk’s SpaceX and Grimes County will produce more than a few children and a break-up song.
Grimes County Judge Joe Fauth III called it a “generational change” for the county, while nearby school districts have approved tax incentives tied to the project.
