News
Tesla describes potential Intel acquisition and chip manufacturing plans as highly unrealistic
Monday, February 16, 2026 at 08:19 PM
Tesla has characterized the possibility of acquiring Intel or building its own semiconductor manufacturing facilities as highly unrealistic, citing the extreme difficulty and impracticality of such an expansion into the foundry business.
Context
Tesla has recently characterized rumors of an Intel acquisition and its own semiconductor manufacturing plans as highly unrealistic, marking a strategic pivot from earlier "TeraFab" ambitions. While CEO Elon Musk previously signaled intent to build a massive domestic fabrication facility to mitigate a 75% surge in DRAM prices, the company is now acknowledging the prohibitive costs and technical complexity involved. Industry rivals, including NVIDIA CEO Jensen Huang, have labeled such a project nearly impossible given the specialized expertise and capital required for high-volume silicon production.
Despite the speculative interest that briefly buoyed Intel’s stock, the chipmaker’s $37.4 billion cash position and recent $15.9 billion in funding from NVIDIA and SoftBank make a Tesla buyout financially improbable. Tesla is instead expected to remain reliant on its existing foundry partners, TSMC and Samsung, for its upcoming AI5 and AI6 chips through 2028. This shift reaffirms a "fabless" strategy as the global semiconductor market tracks toward a $1 trillion valuation in 2026.
Sources (2)
Related Companies
Tesla
TSLA
Intel
INTC