TSMC is exploring Texas as the site for a second U.S. fab, part of an accelerated domestic expansion that now runs through two separate tracks: its own capacity planning and a potential joint chipmaking effort with Elon Musk's Terafab project.

The company confirmed it is considering an expansion tied to Terafab, the large-scale chipmaking initiative associated with Musk. The confirmation came from TSMC's chief executive, who set one hard condition on any deal.

CEO C.C. Wei said TSMC is open to working with Terafab but insisted the company must retain operational control of the plants. Tom's Hardware reported that the CEO stated TSMC would have to run any Texas-based project itself. Bloomberg carried the same position under the headline that TSMC is open to cooperation but must control the facilities.

What does the Texas exploration change?

Texas now sits on TSMC's U.S. site list alongside its established Arizona operations. The Business Journals first reported the exploration of Texas for a second fab location. The report frames the search as part of the chip giant's broader ramp-up of domestic U.S. capacity.

TSMC has not committed to a site, a timeline, a wafer size, or a process node for a Texas facility. All elements of the Texas plan remain at the exploration stage. That distinguishes this project from operating U.S. capacity, where TSMC has already broken ground and begun production work in Arizona.

The distinction matters commercially. A site search is a roadmap item, not confirmed capacity. Customers and suppliers cannot book wafers against an unselected location. Analysts following the company will treat Texas as an option until TSMC announces a capital commitment.

Why does control of the plants matter?

The CEO's condition on TSMC-run operations signals how the company protects its manufacturing model. TSMC's competitive position rests on process discipline and yield management built over decades. Handing plant operations to a partner outside the semiconductor industry would put that model at risk.

The Terafab concept, as described in the reporting, calls for very large-scale chip production linked to Musk's businesses. Musk's companies buy silicon at scale, and AI infrastructure has created demand for advanced logic that few manufacturers can supply. A Terafab tie-up would give Musk's operations a dedicated advanced-capacity path while giving TSMC a major customer commitment.

TSMC's position is narrow but firm. It will discuss capacity, sites, and investment. It will not hand over the fab floor. The CEO's public statement closes the door on any arrangement that resembles contract manufacturing in reverse, where a customer dictates plant operations.

What happens next?

TSMC has laid out a two-track U.S. posture. Track one is its own fab expansion, with Texas now under evaluation. Track two is the Terafab conversation, which advances only on TSMC's operating terms.

No deal value, capacity target, or construction date exists yet for either track. The company has confirmed interest, named a condition, and identified a state. Everything beyond that — site selection, capital expenditure, node assignment — awaits formal board approval and announcement.

The next concrete signal to watch is a site decision in Texas, which would move the project from exploration to committed capital and set the timeline for any Terafab-linked capacity.