Musk solves power generation bottleneck! SpaceX to produce its own gas turbine blades.

Faced with the industry-wide pain point of power shortages for AI data centers, Musk is using his consistent vertical integration logic to try to forcefully break through the bottleneck by starting with the weakest link in the supply chain.

On August 30, according to technology media The Information, SpaceX is building a foundry in Bastrop, Texas, to produce blades and vanes for large gas turbines —core components with the highest technological barriers and the most scarce production capacity in the global turbine supply chain.

After the report was published, Musk personally confirmed the plan on the social media platform X, stating that SpaceX's ability to independently manufacture blades and guide vanes could bring the gas turbine's launch date forward by up to 18 months, calling it "a profound game-changer."

Musk also stated that SpaceX and Tesla are each building 100GW of solar power capacity annually at top speed, but "natural gas will remain a necessary option to supplement and channel solar power for the next few years."

Meanwhile, research by Morgan Stanley analyst Adam Jonas corroborated the above report, noting that the foundry will also cater to the casting needs of SpaceX's Raptor turbopump , enabling cost sharing between aerospace and AI businesses.

Blades: The "Hidden Bottleneck" Holding Back Global AI Computing Power Expansion

The report states that gas turbine blades and guide vanes must operate at extreme temperatures of 3,000 to 3,600 degrees Fahrenheit (approximately 1,650 to 1,980 degrees Celsius), which is about 800 degrees Fahrenheit higher than the material's own melting point , placing extremely stringent requirements on the casting process.

Previously, only four foundry companies worldwide possessed this technology, creating a highly monopolistic structure. This oligopolistic structure has directly resulted in large turbine manufacturers such as GE Vernova having orders booked until 2030, becoming one of the core obstacles to accelerating the construction of AI infrastructure.

In a podcast in February, Musk stated that blades and guide vanes are a "limiting factor" for faster turbine delivery, and warned that at current production capacity, "I'm not sure there's enough available power to turn on all the AI chips that are being produced."

Bastrop: From Satellite Factory to Turbine Casting Base

SpaceX has reportedly established several industrial facilities in Bastrop—about 30 miles from Austin. The company already operates a factory there related to its Starlink satellite business.

According to Corey Trinetti, a due diligence expert at AI infrastructure research newsletter Measured AI, SpaceX purchased approximately 830 acres of land in the surrounding area between March and June of this year . Satellite images show that two new buildings adjacent to the Starlink factory appeared in July, while there were no buildings at the site a year ago.

On the hiring front, SpaceX recently posted several job openings, including a senior operations engineer, a senior materials engineer, an automation engineer, and a senior tooling engineer to oversee the construction, expansion, and ramp-up of the new foundry, as well as a programmer to program high-temperature superalloy milling on the new industrial gas turbine (IGT) blade and guide vane manufacturing line in Bastrop.

However, Trinetti stated that no permits or construction filings for the foundry have been found in Texas's environmental or building archives, and it remains unclear whether SpaceX has initiated the approval process .

Dual-purpose: The cost-sharing logic of aerospace and AI

In a report this month, Morgan Stanley's Adam Jonas noted that SpaceX has established a turbine component foundry in Texas to serve both data center needs and the production of castings for Raptor rocket engine turbopumps.

"Raptor turbopump castings and data center turbine airfoils use the same alloys, furnaces, and skilled workers, allowing a single foundry to spread fixed costs across both the aerospace and AI businesses," Jonas said.

This dual-purpose logic significantly enhances the commercial viability of the foundry, but also makes the outside world cautiously observe whether SpaceX can truly replicate the casting technology accumulated over decades by industry leaders such as Precision Castparts.

Transition period: Acquiring bridging power through acquisitions and partnerships

Before his self-built foundry capacity is operational, Musk is seeking gigawatt-scale transitional power supplies through multiple channels. According to The Information, Musk has recently been quietly collaborating with Wall Street hedge fund Fortress Investment Group, which has already invested in at least two turbine suppliers.

According to a filing with the U.S. Federal Trade Commission in May of this year, Fortress has sold mobile industrial turbine supplier APR Energy to Elon Musk . APR Energy stated in January that its fleet of approximately 1GW of turbines means these assets will be available to Musk.

In addition, SpaceX may also be sourcing turbines from FTAI Aviation, a company that specializes in modifying and refurbishing commercial aircraft engines.

TAI, spun out of another Fortress company, announced a $1.465 billion turbine sales contract in July through its Chinese joint venture partner to "a leading international cloud service provider." Adam Jonas has listed FTAI as a potential supplier for SpaceX.

Morgan Stanley estimates that Musk could acquire approximately 3 to 4 GW of power by the end of 2027 through a series of procurement agreements.

Carbon emission disputes and industry disagreements

However, the report also pointed out that Musk's move to further increase fossil fuel power generation capacity has raised concerns among low-carbon energy advocates.

BloombergNEF estimates that if all planned off-grid natural gas projects for data centers are implemented, it will increase U.S. carbon dioxide emissions by 20% .

This figure does not yet include Musk's latest plans, but it does include SpaceX's xAI division's 2GW off-grid natural gas capacity for its Memphis, Tennessee data center, which is scheduled to be operational by the end of the year.

There is a clear division within the industry regarding whether Musk can truly realize this ambitious plan. Dylan Patel, founder of semiconductor research firm SemiAnalysis, expressed confidence that Musk can do it; while Jigar Shah, a clean energy entrepreneur who previously led the Biden administration's energy loan office, directly countered, "That's because you simply don't know how to build infrastructure."

Musk previously astonished the industry with the rapid deployment of the Memphis Colossus data center— although the facility's quality wasn't top-tier, SpaceX has already reaped substantial profits by leasing it to Anthropic . Analysts point out that the market is closely watching whether this latest gamble on the power sector can replicate that speed.

Risk Warning and DisclaimerInvesting involves risk; please exercise caution. This article does not constitute personal investment advice and does not take into account the specific investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Any investment decisions made based on this information are at your own risk.