Elon Musk said Tesla Inc. needs to build and operate what he is calling a “TeraFab” to manufacture semiconductors, a massive undertaking that will cost billions of dollars and mark another expansion beyond what had been the company’s core electric vehicle business.

Tesla (TSLA.O) said on Wednesday it will invest $2 billion in CEO Elon Musk 's artificial-intelligence company xAI - and that production plans for its ​Cybercab robotaxi were on track for this year.