Elon Musk announced a plan for joint chip production for Tesla and SpaceX

Elon Musk announced plans to create joint chip manufacturing for Tesla and SpaceX. If the idea comes to fruition, the billionaire's two largest companies will have their own semiconductor vertical — from chip design to manufacturing. However, Musk has a well-established reputation for promising one thing while regularly pushing back timelines.

Tesla and SpaceX have long been moving toward their own silicon. Tesla has been developing autopilot chips since 2019 — when the company replaced Nvidia solutions with its own FSD Computer. The Dojo supercomputer for training autopilot neural networks is built on custom D1 processors.

SpaceX uses specialized electronics in Starlink satellites — over 7,000 of which have been launched — and in Starship control systems. The annual chip needs of both companies are measured in billions of dollars. Combining chip efforts makes sense from an economic standpoint: shared R&D expenses, unified architectures, economies of scale.

In the long run, such a vertical would reduce dependence on TSMC and Nvidia. Tesla is already building GPU clusters for training FSD and the Optimus robot, and Musk has repeatedly complained publicly about chip shortages and high costs. Proprietary manufacturing would eliminate this pain point.

But the announcement has a flip side. Musk systematically overestimates the speed of project implementation. Cybertruck was announced in 2019 — it only entered mass production in 2023.

Tesla's full autonomy has been promised in one year since 2016. Starship repeatedly postponed its first orbital flights. Robotaxi was planned for 2020, then 2024 — the service never launched at full scale.

Semiconductor manufacturing is one of the most capital-intensive and technologically complex industries in the world. TSMC builds one factory over several years and invests tens of billions of dollars. Intel has invested over $100 billion in the past decade and still lags leaders in process technology.

Entering this game from scratch is a task of at least 7-10 years even with Musk's resources. So far, details are scarce: timelines are unknown, technological partners are unknown, and investment amounts are unknown. But the strategic direction is clear.

The largest technology companies are actively moving away from dependence on external silicon suppliers: Apple — proprietary chips, Google — TPU, Amazon — Trainium. Tesla and SpaceX are following the same path. If Musk succeeds in realizing even part of the plan, it will create a fundamentally new player in AI hardware with massive internal capacity utilization from day one of operation.