Intel lands Tesla deal

Tesla plans to use Intel’s 14A chipmaking process for processors tied to its Terafab project in Austin, giving Intel its first reported major outside customer for the node. (usnews.com) Elon Musk said April 22 that Tesla would use Intel’s next-generation process at the Austin complex, which Reuters described as an advanced artificial intelligence chip project. Intel declined to comment on Musk’s remarks. (usnews.com) Reuters reported Intel joined the Terafab effort earlier in April alongside Tesla and SpaceX. Musk said in March that Tesla and SpaceX would build two advanced chip factories there, one for cars and humanoid robots and another for space data centers. (usnews.com) Intel has spent the past two years trying to turn its factories into a contract manufacturing business that can make chips for other companies, not just for Intel itself. At its February 2024 foundry launch, Intel said Microsoft planned a chip design on Intel 18A, but 14A had not yet been tied publicly to a major external customer. (intc.com) The 14A process is the step after Intel 18A in the company’s roadmap. Intel says 14A will use RibbonFET 2 transistors and PowerDirect, a second-generation backside power system that moves power lines behind the chip to free space and improve performance. (intel.com) Intel has been courting customers aggressively around that roadmap. At Intel Foundry Direct Connect on April 29, 2025, the company gathered more than 1,000 customers and ecosystem partners in San Jose to pitch its manufacturing plans and packaging services. (newsroom.intel.com) The deal does not reorder the foundry market overnight. Taiwan Semiconductor Manufacturing Co. remains the dominant contract chipmaker, while Intel is still trying to prove that its newest manufacturing nodes can attract steady outside volume. (investor.tsmc.com, usnews.com) Investors treated the announcement as a useful signal for Intel, not a finished turnaround. Reuters reported Intel shares rose 3.6% in extended trading after Musk’s comments, while Tesla shares slipped slightly after hours as Musk also raised the company’s capital spending plans. (usnews.com) Big pieces of Terafab are still unsettled, including who pays for the equipment, who runs the factories and when production starts. For Intel, though, Musk’s choice gives 14A a named customer before the process reaches full scale. (usnews.com)