(The Center Square) – Another billion-dollar company is receiving millions of dollars in taxpayer funds to expand operations in Texas, this time SpaceX in Bastrop, Texas.
Elon Musk-founded Space Exploration Technologies Corporation, SpaceX, received the fifth Texas Semiconductor Innovation Fund grant of $17.3 million to expand its semiconductor research and development and advanced packaging facility in Bastrop. SpaceX is expected to make a $280 million capital investment; the expansion is expected to create more than 400 jobs.
“Texas connects the nation and the world with the most advanced technologies manufactured right here in our great state,” Gov. Greg Abbott said, adding that SpaceX’s “Texas-sized expansion” of its Bastrop facility “will be the largest of its kind in North America.”
“Working together with innovative industry leaders like SpaceX, Texas will continue to rank No. 1 for semiconductor research and high-tech manufacturing and secure critical domestic supply chains as we build a stronger, more prosperous Texas than ever before,” he added.
Through the Texas CHIPS Act, nearly $700 million worth of taxpayer grants is being awarded through the TSIF, The Center Square reported. So far, the money is being awarded to companies with multi-billion-dollar valuations. SpaceX’s December valuation stood at $350 billion, making it the world’s most valuable private company, according to Bloomberg News.
Over the next three years, SpaceX’s Bastrop facility is expected to expand by one million square feet to manufacture and produce Starlink kits and their component parts, including advanced packaged silicon products. Starlink satellites currently provide high-speed, low-latency broadband internet to more than five million customers in more than 120 countries and territories. The proposed project includes printed circuit boards, a semiconductor failure analysis lab, and advanced packaging for panel level packaging. Once complete, SpaceX’s Bastrop facility will be the largest PCB and PLP facility in North America.
“We love Texas. SpaceX is investing hundreds of millions of dollars into our Bastrop facility. This grant will help continue to expand Bastrop’s manufacturing for Starlink to help connect even more people across the state and around the world with high-speed, low-latency internet,” SpaceX President and Chief Operating Officer Gwynne Shotwell said.
State Senator Charles Schwertner, R-Georgetown, lauded the initiative, arguing, “We are incredibly fortunate to have a world-class facility like SpaceX in Bastrop County. From the cell phones in our pockets to strengthening our national defense, semiconductors power our everyday lives. This investment will bring hundreds of high-paying jobs to the area and serve as a catalyst for further economic growth.”
In response to supply chain failures during the Biden administration, Abbott and major companies prioritized expanding semiconductor manufacturing in Texas. The Texas legislature passed the Texas CHIPS Act, which Abbott signed into law in 2023. It created the Texas Semiconductor Innovation Consortium and TSIF grant, among other provisions, to solidify Texas as the U.S. leader in the semiconductor industry, The Center Square reported.
The first TSIF grant of $4.12 million was awarded to Intelligent Epitaxy Technology, Inc. to expand operations at its wafer production facility in Allen. The second was awarded to Dongjin Semichem Texas of $2.4 million for its specialty chemicals and materials facility in Killeen, The Center Square reported. Austin-based Silicon Laboratories Inc. received the largest grant so far of $23.25 million to support its research and development for wireless product development. The fourth TSIF grant of $2 million was awarded to Korean-based KoMiCo Technology, Inc.’s Round Rock facility, The Center Square reported.
Prior to the Texas CHIPS Act, Texas Instruments broke ground on a new semiconductor plant in Sherman in 2022, announcing a $30 billion investment to expand its manufacturing capability long term. It remains the largest private-sector economic investment in Texas history.
Also in Sherman and in 2022, Taiwan-based GlobalWafers Co. announced it was building a 300-millimeter silicon wafer factory.
In 2023, Texas ranked first for having the best business climate and first for semiconductor production, also leading the U.S. as the top exporter of semiconductors and other electronic components for 13 years, The Center Square reported.
Texas leads the U.S. in new chip manufacturing; more than 43,000 currently work in the Texas semiconductor industry.
The Texas CHIPS Act is separate from the federal CHIPS Act, which appropriated nearly $6.5 billion to semiconductor manufacturing in Texas, The Center Square reported.
