Elon’s Is About To Leave Nvidia In The Dust And Do Something No One Else Has Ever Done (Again)…

Last night, Elon made what is arguably one of the most important announcements in the history of human technological evolution…

Specifically, he announced the launch of the “Terafab”… Tesla’s new fabrication plant in Austin for microchips and semiconductors…

I wrote about this briefly in last week’s newsletter, but now we have real details…

So what does the name “Terafab” even mean by the way?

Well, Elon’s goal is to use Terafab to add “1 Terawatt” of computing power to the planet at this new facility…

And What The Heck Does A “Terawatt”
Of Compute Actually Mean?

Well let me put this into perspective…

Right now, every data center on Earth… Every server farm run by Amazon, Google, Microsoft, Meta, OpenAI, xAI, China, Japan, etc… And every government, every bank, every hospital, and every university… Adds up to roughly 122 gigawatts of installed computing power.

That's the entire global digital infrastructure, built over decades, by thousands of organizations, costing trillions of dollars.

Well Terafab is targeting 1 terawatt… That's 1,000 gigawatts.

In other words, this one facility in Texas is being designed to deliver roughly eight times the computing power of every data center on the planet today… Combined.

Every step of the chip manufacturing process from design, to testing, to manufacturing, will take place under this one single roof which has never been done before.

And the facility will be MASSIVE… Below you can see the current Gigafactory in Austin at the bottom left which is 1 mile long, and one of the largest buildings on the planet…

The TeraFab on the right which is going to be 100 million square feet, makes it look tiny…

Terafab will dramatically reduce cost and the time it takes to develop and build increasingly more powerful chips, and provide Tesla with the only fully integrated supply chain that will allow them to dominate the world of AI and robotics moving forward…

No one… Not AMD, TSMC, or Nvidia will be able to keep up with the speed of Tesla’s chip design, to production cycles.

That Brings Us To Part 2: Energy…

Right now we simply don’t have enough power production capacity to support this level of computing power on the ground…

Which means they need to go into orbit where’s there’s no land to pay for, EPA restrictions to worry about, or power plants to build…

SpaceX’s reusable rockets will deploy the approved 1 million+ data centers into orbit for less money that it would costs to build any of the infrastructure on Earth, and once there, the sun will power them for free…

And let’s be clear…

No one else can do this…

There’s not a single chip manufacturer in the world that’s vertically integrating the entire process in house under a single roof…

And there’s not a single company outside SpaceX that can deploy these chips into orbit at such a low cost.

Tesla and SpaceX will now have the only complete ecosystem to power the future…

• In-house chip design and manufacturing

• In-house robot and hardware manufacturing

• Ai data-centers without energy limitations

• Ai processing models with Tesla FSD and Grok

• Space-based AI deployment system via SpaceX

• Space-based internet and telecommunications system via Starlink

• And terrestrial energy systems via Tesla Megapacks.

As Far As I’m Concerned, This Is “AI Check-Mate” By Tesla And SpaceX…

By 2030, China will likely invade Taiwan where TSMC is located, and where 90% of all current chips in the world are manufactured…

But in three years, that facility will be considered “table scraps” compared to what will be produced at Tesla’s Terafab...

What Elon is doing is genuinely unprecedented, and it’s why the "car company" valuation framework for Tesla that still dominates analyst coverage will eventually be discarded entirely in the year ahead...

With That Being Said, Macro-Economic Cycles Are Dominant Over Short-Term Stock Prices…

As I’ve been predicting for months in the Inner Circle, Tesla stock is headed lower along with the rest of the market… And this downturn will likely last until mid-term elections are over in Q4…

Once CLEAR turns gold, that’s your last best chance to buy the most important stock in the world at such low prices…

And by the way… Do I think Nvidia will be hurt by the loss of Tesla’s business?

No.

They have more demand for their chips than they can currently keep up with which is why Tesla is going to make their own…

But they’ll be building slower, more expensive chips for everyone else in 2nd place as far as the AI race is concerned…

If you haven’t watched the Terafab launch event video, you absolutely should. It begins at the 15:40 minute mark…

Sincerely,

Mike Dillard ✞
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