Texas Instruments Announces $60 Billion Investment in U.S. Semiconductor Manufacturing

In a significant development for the American technology landscape, Texas Instruments (TI) has announced an investment of over $60 billion to construct and expand seven semiconductor fabrication plants in the United States. This initiative marks the largest investment in semiconductor manufacturing in U.S. history, aimed at boosting domestic chip production, creating tens of thousands of jobs, and reinforcing the supply chain for essential electronic components.

Investment Overview

The investment will be distributed across three major manufacturing sites located in Texas and Utah. The primary focus is on a mega-site in Sherman, Texas, where TI plans to invest up to $40 billion to establish four fabrication facilities. Construction is already underway for the first two fabs, designated SM1 and SM2, with production from SM1 expected to commence later this year. Plans for two additional fabs, SM3 and SM4, are also in place to accommodate future demand.

In addition to the Sherman site, TI is enhancing production capabilities at its existing facilities in Richardson, Texas, and Lehi, Utah. This expansion is projected to generate more than 60,000 jobs across the U.S., including direct employment and indirect jobs related to construction and supply chain activities.

Focus on Analog and Embedded Processing Chips

The expansion will primarily focus on the production of analog and embedded processing chips on 300mm wafers. These chips are crucial for a wide range of electronic devices, including smartphones, electric vehicles, industrial machinery, and medical equipment. While TI does not manufacture the high-performance GPUs commonly associated with AI, its chips play a vital role in the broader AI ecosystem by managing power, interfacing with sensors, and converting data in various AI-enabled devices.

Industry Support and Strategic Significance

Leaders from major technology and automotive companies, including Apple, Ford, Medtronic, and NVIDIA, have expressed support for TI's investment, emphasizing the importance of a robust domestic supply chain for their innovation and manufacturing efforts. The increased production capacity is expected to meet the growing demand for foundational chips as AI technology continues to evolve and expand into various sectors.

Government Support and Future Outlook

This multi-billion-dollar initiative is bolstered by government support through the CHIPS and Science Act, which aims to revitalize the U.S. semiconductor industry. Texas Instruments has been awarded up to $1.6 billion in direct funding from the CHIPS Act to assist with the construction of its new fabs. Additionally, the company anticipates receiving an estimated $6 billion to $8 billion through the U.S. Department of Treasury's Investment Tax Credit for its manufacturing investments.

By significantly increasing its domestic production capacity, TI aims to secure its supply chain and contribute to a more resilient American technology sector. This landmark investment is expected to have lasting implications for the U.S. economy and the future of technology.