TSMC is talking to Elon Musk's Terafab chip project, but it wants to run any factory it helps build. Chairman and CEO C.C. Wei said so on the company's third-quarter earnings call on Thursday, Oct. 15, 2026. "We are still in discussion, let me say that," Wei told analysts, according to Bloomberg. "But the fab has got to be run by TSMC."
That puts TSMC and Musk on opposite sides of the same question. Last week Musk said his companies would "build and run the fab," and added: "Maybe TSMC subleases part of the Terafab if they want, but nothing more than that," as Taiwan News and Bloomberg recount. We covered that exchange in Musk's comments on TSMC and Intel's role.
What Wei said about Texas
Wei said TSMC is expanding U.S. capacity because most of its large customers are American and are asking for more supply, and because the U.S. government has been helpful. TSMC has been looking beyond Arizona, and Texas is one option. "We sent the teams to Texas to do all the evaluation," he said, according to the Associated Press.
He said TSMC has also talked with Terafab about whether it could use the project's extra capacity. No agreement has been reached, and Wei said TSMC would share a conclusion once there is one. Neither company has described the terms under discussion beyond confirming the talks, Bloomberg reports. Intel is already helping Musk's companies with the chip technology planned for Terafab, Bloomberg adds.
The quarter behind the comments
TSMC reported third-quarter revenue of NT$1,494.24 billion (US$46.72 billion), up 41.2% from a year earlier in U.S. dollars, and net income of NT$763.06 billion, up 68.7%, according to its earnings release. Gross margin was 66.4%. For the fourth quarter it guided revenue of US$52.3 billion to US$54.3 billion, and it now expects 2026 revenue to grow about 44% in dollar terms.
"The demand, actually, is still far above our capability today to supply, and we're working very hard to narrow the gap," Wei said, per the AP. TSMC kept its 2026 capital spending plan at $60 billion to $64 billion, and said volume production at its second Arizona fab will begin in the third quarter of 2027, slightly ahead of schedule, Dow Jones reported. TSMC's U.S.-listed shares were down 1.5% at $423.30 in premarket trading, and its Taiwan shares closed 2% lower.
What it means for Tesla
Terafab is meant to supply advanced chips across Musk's companies, including Tesla's cars and robots, Bloomberg notes. Who operates the plant matters because it decides who controls the process, the schedule and the capacity. Today the two public positions don't fit together: Musk says his companies run it, and TSMC says it runs any fab it is part of. Until one side moves or a deal is announced, nothing changes for Terafab's current plan, which still leans on Intel. Track the project's milestones on our Terafab tracker, and see our earlier report on Terafab's first ASML EUV tool.