Texas Instruments (TI) recently announced plans to begin building a Richardson, Texas-based $850 million production facility. The chipmaker plans to complete construction of the factory’s shell by 2021 and for it to commence operation in 2024.
The plant will produce 300 mm wafers and will replace aging sites the firm maintains in Sherman and Dallas.
Richardson Plant Details
TI revealed its intentions to establish a new facility in the Dallas County city last April. The company explained it selected the area because of the quality of its regional talent, supplier base, closeness to local airports, and proximity to its other Richardson facility.
The chipmaker received ample state and local support to establish its new plant in the bustling technology hub. The Texas Enterprise Fund awarded TI with a $5.124 billion grant, and the Plano Independent School District is providing the firm with a $100 million tax break. In return, the company is hiring 625 workers to staff its new factory, with salaries starting at $64,000.
TI already completed construction on the plant’s parking structure and will spend $3.1 billion on the entire project.
Investing in the Future
TI’s decision to prioritize the construction of its new facility should pay off in a few different ways.
For one thing, the company made a very strategic move by consolidating its U.S. production capacity. By shuttering two 50-year-old plants in favor of establishing a state-of-the-art factory, the firm will reduce its operating costs. The Richardson site’s 300 mm wafers offer more than double the chip space of its 200 mm semiconductors, making them a more valuable commodity.
TI’s construction initiative also comes at a time when the White House wants leading semiconductor manufacturers to increase their American production footprints.
In addition to pleasing the federal government, the chipmaker’s new plant will offer it some protection against future supply chain disruption. In recent years, the Sino-American trade war and the COVID-19 outbreak have created major problems for multinational corporations. By keeping part of its production line geographically centralized, the company will not be as vulnerable to spiking tariffs and sudden import restrictions.
Last quarter, TI beat Wall Street’s earnings estimates because of the care and wisdom of its leaders. The firm’s call to push ahead with its Richardson plant despite larger economic headwinds is another reflection of its strong corporate stewardship.