Tesla does $16.5bn deal to make ICs at Samsung’s Taylor, Texas fab

Samsung is to make chips for Tesla at its Taylor, Texas fab.

“Samsung’s giant new Texas fab will be dedicated to making Tesla’s next-generation AI6 chip. The strategic importance of this is hard to overstate,” said Elon Musk (pictured)  in a post on X earlier today, “”Samsung agreed to allow Tesla to assist in maximising manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house.”

The deal is said to be worth $16.5 billion

Earlier this month Samsung said it was delaying construction at Taylor because it did not have a customer for the fab’s output

Samsung’s struggles with 2nm yield and TSMC’s success at 2nm meant that the big customers signed up with TSMC – Apple, Broadcom, Mediatek, AMD, Qualcomm.

Samsung was to have spent $37 billion building fabs in Texas with the Chips Act contributing $4.7 billion plus loans and tax credits. Originally to be a 4nm fab opening in 2024, the current fab became a 2nm facility opening in 2025 which has now been put back to 2026.

The  building is said to be more than 90% complete but has not yet been equipped as there was no business case for equipping it while there were no customers.