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SpaceX contemplates Mars rocket factory on the South Texas coast
In statements provided to the Brownsville Herald, a Texan paper dedicated to a South Texas region that includes SpaceX’s Boca Chica launch site, state representative René Oliveira hinted that SpaceX’s plans for the region could go “well beyond conducting launches.”
SpaceX and South Texas
The Herald’s Steve Clark provided a great summary of the history between SpaceX and Texas in recent years, particularly related to the company’s efforts to construct a launch facility in the region. Aside from a considerable effort to create a sturdier foundation for the pad along the sandy, shifting shoreline of Boca Chica, Texas, the company’s work in the region has been rather quiet since the prospective pad’s announcement in 2014. Through a combination of tax incentives and a direct cash infusion, the state of Texas and the Rio Grande Valley region have both in some way strived to strengthen their relationships with SpaceX and solidify the iconic group’s presence in the region.
For Brownsville and Boca Chica, in particular, the latter of which has a population well under 100 individuals, SpaceX’s permanent presence would be a massive boom for the local economy by bringing an infusion of dozens or potentially hundreds of skilled, full-time positions to the quiet region.
In recent months, SpaceX has been very gradually progressing development of facilities around their potential launch site, albeit not the pad itself. These changes include a nearly complete public-private radio communications facility intended to both give college students hands-on experience and communicate with SpaceX’s Crew Dragon capsule as early as late 2018. Intriguingly, a Tesla energy installation has also been recently spotted at the facility.
Finally, a vast crane has been semi-permanently stationed on SpaceX property and had a corrugated shed build around it to protect it from the elements and SpaceX stalking fans in the region.
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- Tesla Powerpack battery storage unit being installed at SpaceX’s facility in Boca Chica, Texas [Credit: Nomadd via NASASpaceFlight.com Forum]
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- The boom of a giant crane (possibly meant for BFS) seen in late 2017, parked at SpaceX’s Boca Chica facilities. (Reddit /u/ ticklestuff)
More than just a launch pad?
State Rep. Oliveira’s statements can be seen in full below.
“About a year ago, SpaceX came to me with their concept of a new, larger, expanded plan for Boca Chica Beach,” Oliveira said. “The concept went well beyond conducting launches, and would require new commitments for construction, investment and jobs to support the new operations.”
“We looked at the original plan for the launch site, and the chain of work that would be done inside and outside on the rockets that would take off from Boca Chica. The concept SpaceX is examining would bring a lot of that work to Boca Chica, going well beyond the original plan.”
He [State Rep. René Oliveira, D-Brownsville] declined to reveal the details of the new concept for Boca Chica, saying it’s up to SpaceX to detail its plans and associated costs when it makes a request to CCSDC to apply for funding.
The timing of SpaceX concept, reportedly presented to Oliveira in late 2016 or early 2017, strongly indicate that the rocket company is considering a considerable expansion of their aspirations for the South Texas facilities under construction. Partly based on Oliveira’s suggestion that SpaceX and Brownsville “looked at…the chain of work” necessary for rockets to launch Boca Chica, the most obvious conclusion available is that SpaceX is thinking about developing Boca Chica into a veritable rocket city.
A Falcon 9 conducts tests at SpaceX’s McGregor testing facility in central Texas. (SpaceX)
A major problem facing SpaceX’s Mars rocket (BFR) program is dealing with the vehicle’s sheer size, 9m (30 feet) in diameter and at least as tall as Falcon 9. This size would make transporting the vehicle cross-country by road all but impossible, potentially forcing the company to abandon a bulwark of their current Falcon manufacturing strategy. The most obvious solution, as discussed briefly by CEO Elon Musk and President Gwynne Shotwell, would be to build a rocket factory where the launch pad is located. Boca Chica is thus almost certainly a prime location under SpaceX’s consideration for both the launch complex and factory needed to build and operate BFR. And this argument has been strengthened in recent months by statements from both executives hinting that prototype BFR spaceship (BFS) tests could begin in South Texas as soon as early 2019.
To say that the creation of such a manufacturing and launch infrastructure would transform the region would be an understatement. The sheer shock value of a small city being able to lay claim to the only private orbital launch complex in the US would be valuable in its own right, not to mention the distinct possibility that such a facility might one day launch the first humans to Mars. If the educated speculation above is, in fact, the truth of the matter, SpaceX can be expected to begin earnestly petitioning the local and state governments for additional public funds to partially support the major undertaking. Most importantly, the company would almost certainly need to procure an updated or wholly new environmental impact assessment from the FAA before being allowed to begin construction beyond the scope of the original 2014 grant.
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Tesla shared a striking video showcasing the decommissioning of the original Model S and Model X assembly line at its Fremont Factory in Northern California. Completed in just 46 days, the teardown involved heavy machinery dismantling concrete pits, removing robotic arms and conveyors, and clearing the space for new production.
The post, captioned “End of an era,” captured both the end of a historic chapter and Tesla’s aggressive pivot toward its next major initiative, Optimus.
End of an era: Decommissioning the original Model S & X assembly line in just 46 days pic.twitter.com/kGEdfhl62h
— Tesla Manufacturing (@gigafactories) July 10, 2026
The decision to retire the Model S and Model X originated during Tesla’s Q4 2025 Earnings Call in late January 2026. CEO Elon Musk announced that production of the company’s flagship sedan and SUV would wind down by the end of Q2 2026, describing it as bringing the programs to an “honorable discharge.”
Custom orders ceased around early April 2026, with the final vehicles rolling off the line in early May. A special signature delivery ceremony on May 20 marked the emotional close for these vehicles, which had defined Tesla’s early success and luxury EV segment since the Model S launch in 2012.
The primary reason for tearing down the lines was to repurpose the valuable factory floor space for high-volume production of Tesla’s Optimus humanoid robot. Musk had indicated on Earnings Calls that the Fremont S/X line would be replaced by a dedicated Optimus manufacturing line targeting a capacity of one million units per year.
This move aligns with Tesla’s broader strategic shift from traditional vehicle manufacturing toward robotics and artificial intelligence, leveraging the company’s expertise in autonomy, AI training, and high-volume production.
Optimus, Tesla’s general-purpose humanoid robot, is designed to perform repetitive or dangerous tasks in factories, warehouses, and eventually homes. Powered by Tesla’s AI and Neural Networks, it aims to be a versatile, affordable platform. Production of Optimus Gen 3 is already underway in limited form at Fremont, with full-scale output on the converted line expected to begin in late July or August.
Tesla is targeting rapid scaling, with internal ambitions pointing toward tens or even hundreds of thousands of units annually by the end of 2026.
Longer-term, Tesla is constructing a much larger second-generation Optimus facility at Giga Texas, with potential capacity reaching millions of units per year. The company views Optimus as a transformative product that could eventually surpass its automotive business in scale and value, enabling widespread deployment of useful robots across industries. CEO Elon Musk has even predicted it would be the most popular product of all-time.
As one era closes at Fremont, another is rapidly taking shape.
Elon Musk posted a candid admission on his social media platform X on June 9, declaring that he had been “clearly wrong” about Anthropic. The statement marked a notable reversal from his earlier skepticism toward the AI company.
In September, Musk had written, “Winning was never in the set of possible outcomes for Anthropic,” reflecting his view at the time that the startup had lacked the foundation or even the trajectory to succeed in what is an incredibly intense race for advanced artificial intelligence.
Musk’s latest post came amid discussion of Anthropic’s reliance on external compute resources. He praised the company’s progress, stating that Anthropic is “obviously currently the leader in AI” and that “no company has released a model as good as Mythos/Fable,” with expectations of a strong follow-up in Mythos 2.
The tone shifted dramatically from dismissal to acknowledgement of superior performance.
I was clearly wrong about Anthropic. They are obviously currently the leader in AI. No company has released a model as good as Mythos/Fable and they will undoubtedly have Mythos 2 ready soon.
And I would never cut them off in a way that hurt them badly, even as a competitor.…
— Elon Musk (@elonmusk) July 9, 2026
The context of Musk’s comments added significance. Anthropic has been operating under a recent compute deal with SpaceXAI, Musk’s AI infrastructure-focused venture. The pair entered a short-term GPU lease agreement initiated in May, providing Anthropic access to critical computing power for training and deploying its frontier models.
SpaceXAI signs agreement with Anthropic for massive AI supercomputer access
Some observers had speculated that Musk could leverage this dependency to disadvantage a rival. Musk directly addressed the possibility, writing, “I would never cut them off in a way that hurt them badly, even as a competitor. That’s not my style.”
To support his commitment to ethical competition, Musk referenced concrete examples from his other companies. Tesla famously open-sourced its entire portfolio of electric vehicle patents in 2014. The move was designed to accelerate the global adoption of sustainable transportation technology rather than protect proprietary advantages.
Tesla also made its Supercharger network available to competing electric vehicle manufacturers, transforming what could have remained an exclusive charging ecosystem into a shared infrastructure that benefits the broader industry and reduces barriers for EV adoption.
Musk further pointed to SpaceX’s practices, noting that the company launches satellites for competing commercial systems “with no increase in price or use of unfair terms.” He extended the principle to his social platform, observing that “even my worst enemies attack me on this platform,” underscoring preference for open discourse over retaliation.
These examples have illustrated Musk’s long-standing philosophy that long-term technological progress is best served by open competition and infrastructure sharing rather than leveraging market power to stifle rivals. In the fast-evolving AI sector, where compute resources and model capabilities determine leadership, Musk’s stance suggests a willingness to compete on innovation and performance alone.
Musk’s admission arrives as SpaceXAI itself advances its own frontier models while maintaining business relationships across the ecosystem. By publicly correcting his earlier assessment and reaffirming principles of fair play, Musk highlights a model of competition that prioritizes advancement of the field over short-term tactical advantages.
A Tesla analyst believes the company’s Full Self-Driving suite is close to an “inflection point,” where people will finally realize that it is more than what it appears, similar to how many view the iPhone.
Pierre Ferragu, an analyst who has covered Tesla for many years at New Street Research, says the Full Self-Driving suite is one piece of evidence supporting the view that a Tesla is more than a car. He compared it to the iPhone and noted that the high price tag seemed like a lot for a phone early on. Then people realized the iPhone was more than just something you make calls with. It made their lives simpler.
🚨 Analyst @p_ferragu says Tesla Full Self-Driving is at an “inflection point” in a recent commentary:
“A Tesla is not a car, the same way an iPhone was not a phone. As a tool that gets you to work peacefully every morning, it is not expensive. Give us 2 more quarters to see… pic.twitter.com/tm6xFrjVPV
— TESLARATI (@Teslarati) July 10, 2026
Suddenly, that price tag was justified.
Tesla offers several models under the average transaction price for a new vehicle, which was above $49,000, according to Kelley Blue Book. However, that does not take into account that many people can still not afford a $35,000 vehicle. Ferragu offers his thoughts:
“Remember when the addressable market of the iPhone was 10 million units? Then people realized how good it was, and now, nearly 250m are sold every year.
A similar evolution for Tesla is still on the table. A Tesla is not a car, the same way an iPhone was not a phone.
A model 3 at $35k + $100 per month is too expensive for most, but only as a car, the same way a $600 iPhone was too expensive for most, until most realized it was much more than a phone.
As a tool that gets you to work peacefully every morning, it is not expensive.”
This point is valid, especially considering the iPhone’s impact on the cell phone market. There are still a handful of players, but most people you know have an iPhone. The iPhone ties into Apple’s other ecosystem of products.
This is how Tesla plans to infiltrate the automotive market, and once the company offers a fully autonomous suite, or something that can allow for unsupervised self-driving, more and more people will flock to Tesla.
Ferragu believes Tesla needs two additional quarters of development before things will truly change. He didn’t elaborate on what will happen in two quarters, but he said it will give us all time to “see where this is heading.”
It is really quite interesting to see people’s reactions when they find out what a Tesla is capable of. Full Self-Driving is a great tool for taking stress out of travel; I use it daily, and it has made it really difficult to consider taking any other car on a drive of practically any length.
To me, it is really hard to believe that people will not at least seriously consider a Tesla as their next car if they experience Full Self-Driving. This is a major point for those who argue that Tesla should advertise in some way.
Tesla shows rapid teardown of Model S and X lines, paving the way for Optimus at Fremont
Elon Musk admits he was ‘clearly wrong’ about Anthropic
