Musk Plans Semiconductor FOPLP Plant by 2026

Industry sources reveal that Elon Musk, the mind behind SpaceX and Tesla, is planning to establish a complete semiconductor manufacturing supply chain. His long-anticipated new FOPLP (Fan-Out Panel-Level Packaging) facility in Texas has now entered the equipment delivery stage, with mass production expected by Q3 2026.

After not securing prioritized production capacity from TSMC, Musk quickly adapted by outsourcing Dojo 3 chip production to TSMC and Samsung, while Intel's Arizona plant handles packaging. Signals of deeper collaboration with Intel have emerged, potentially including joint wafer fab projects or equity partnerships.

In recent years, Musk has completed both a PCB plant and an FOPLP packaging facility in Texas. The PCB plant is already operational, while the FOPLP plant—operated by SpaceX—is designed to strengthen vertical integration for satellite systems, reduce component costs, and improve performance for projects like Starlink. Before the new plant comes online, certain chip orders are being handled by STMicroelectronics and other contract partners.

SpaceX's Texas FOPLP line began equipment delivery in September 2025. Full installation is expected by Q1 2026, with small-scale production starting in Q3 2026 and large-scale output by Q1 2027. Initial monthly capacity is projected at approximately 2,000 units.

At a recent Tesla shareholder meeting, Musk noted that increasing investments in AI and robotics could drive the need for a large wafer fab capable of producing 100,000 to 1 million wafers per month. He also mentioned the potential for collaboration with Intel in wafer manufacturing.

Analysts point out that Musk has successfully completed PCB and FOPLP facilities, and his track record with SpaceX's Starship and Tesla's EV innovations suggests semiconductor manufacturing may be within reach. However, TSMC's leadership in advanced process nodes remains strong, so Musk may initially focus on mid-to-low-end chips as a step toward building a broader semiconductor ecosystem.

Additional reports highlight that Musk's FOPLP facility has attracted senior experts from TSMC, Intel, Samsung, and packaging partners. If collaboration with Intel proceeds, it could accelerate wafer fab development. While achieving the scale and sophistication of TSMC or Samsung is still a challenge, establishing a fab for 14nm and above processes appears feasible.