fact, in ballroom number one.

There will be three other factories, one to the

north and two of them that are to the west of

this.

There's a boom happening in Texas.

And we're not talking about oil.

America's biggest state has become the hub for

manufacturing the country's tiniest

microchips.

Now, because we have ports, because we have

access to materials, because of our low cost of

doing business, we are best situated to lead this

next generation of chip manufacturing.

The integrated circuit was invented at Texas

Instruments more than 60 years ago, but it's

Silicon Valley in California that's long

held the title for, well, advancing technology on

silicon. But as the cost of making smaller and

smaller transistors has skyrocketed, so has the

size of the machines and the amount of land needed

to do it.

I mean, Texas is spacious, it's huge, and then it has

great support for ease of business.

Now manufacturing chips on U.S.

soil is a growing priority amid mounting

geopolitical tensions between China and Taiwan.

The Chips Act set aside more than $52 billion for

reshoring production.

Samsung, Texas Instruments, Infineon,

GlobalWafers, NXP, Applied Materials, all

these chip giants have ramped up operations in

the Lone Star State.

Apple and Amazon chose Texas for designing their

custom chips, too.

Tell me why we are wearing these things

called bunny suits.

These beautiful bunny suits are to keep the

product clean. So this is a class one clean room.

We change out all of the air every eight seconds.

So if you ever see an eyelash on a chip, it

looks like a space monster.

We got a rare look inside the clean rooms of three

huge chip fabrication plants, or fabs, around

Texas and took a tour of two more being built for a

total of $47 billion in new investment coming to

the state.

While chip companies have made a flurry of big Texas

expansions in the last couple of years, the

states actually had ties to the semi industry for

more than 90 years since the founding of

Geophysical Service, Inc., which four Dallas

engineers reimagined in 1951, renaming it Texas

Instruments. The transistor, the most basic

building block of semiconductors, was

invented three years earlier at Bell Labs in

California, what would become Silicon Valley.

But it was Jack Kilby at Texas Instruments that

first filed for a patent of the integrated circuit

in 1958.

This invention opened up the possibility of

miniaturizing chips by creating the entire

circuit, not just the transistors, out of

silicon. TI Went on to build the first handheld

electronic calculator in 1967, and it's still well

known today for graphing calculators used in

classrooms around the world.

It is very much so the calculator company to much

of the world. But we are so much more than that,

obviously. You have an electronic device, you

almost certainly have a TI Semiconductor chip

inside of it.

So we have 80,000 products that ship out to

100,000 different customers.

So whether it's analog, but maybe more

importantly, think about anything that you can plug

into a wall or that has a cord in it very likely has

a TI power management IC in it.

Kyle Flessner has been with TI for 30 years.

He showed us around TI's RFAB2 in Richardson, just

north of Dallas.

With this second, bigger fab that came online in

September, TI plans to output a combined 100

million analog chips per day at its two fabs in

Richardson.

So this is our overhead delivery system.

We've got about 15 miles of track between these two

factories, and those cars can move as fast as seven

and a half miles an hour.

And Flessner took us to the construction site of

TI's $30 billion fab coming to the 45,000

person city of Sherman, 60 miles north of Dallas.

We're standing under the waffle table.

That's what it's commonly called.

So it's a clean room up top.

The air comes through, the utilities come through

that support all of that tool infrastructure.

Our fab uses only 300 millimeter or 12 inch and

is fully automated.

Samsung is the state's other huge chipmaker.

The South Korean giant came to Texas in 1996,

breaking ground on a big fab in Austin that's now

fully devoted to foundry, making logic chips for

outside customers.

Samsung opened a second fab there in 2007.

Everything is supposed to be bigger and better in

Texas.

Texas does indeed have plenty of land for the

gigantic footprint of modern chip fabs.

Now, Samsung is adding a whopping 1,200-acre new

site in Taylor, 30 miles north of Austin, where it

plans to make its first advanced chips in the U.S.

starting next year.

Our customers love to come to Texas.

It's equidistant from either coast, and we know

that some of the world's most prominent fabless

companies are actually in the United States.

Bringing Taylor on board is just going to increase

their ability to source their chips domestically

and not have to go into areas of the world where

they may have some discomfort.

Texas has long been famous for policies that entice

new businesses. It's one of only a handful of

states with no income tax.

Combine that with sales tax exemptions for

manufacturing machinery and a variety of other tax

waivers, and it's no surprise that a number of

major companies have relocated or built in

Texas lately. There's Tesla's expanding

Gigafactory in Austin, and major companies that

relocated their headquarters to Texas

recently include Caterpillar, Charles

Schwab, Hewlett Packard and Oracle.

Now, the chip industry has its own special set of

incentives. In June, Abbott approved the Texas

Chips Act, setting aside $1.4 billion to subsidize

companies that manufacture in the state,

as well as universities willing to build related

R&D centers.

Texas ranks number one in the United States for tier

one research universities, and within a

100-mile area of where Samsung is going to be

located, they have access to so much incredible

intellectual talent.

It's not hard to see why Abbott aims to keep Texas

at the center of the national conversation

about reshoring chip manufacturing. More than

half a trillion dollars worth of semiconductors

were sold globally in 2022, and chips accounted

for more than 300,000 jobs in the U.S.

Chips are vital not only for powering our cars,

phones and computers, but for national security,

from military communication systems to

fighter jets and advanced weaponry.

And when peaking demand during the pandemic

coincided with supply chain disruptions, the

resulting chip shortage made it abundantly clear

how much the world relies on chips made in Asia.

As of 2021, 92% of the world's most advanced

chips were made in Taiwan by Taiwan Semiconductor

Manufacturing Company.

And China has repeatedly threatened to invade

Taiwan, a move that could cut the U.S.

off from the majority of advanced chips.

One thing that we've learned with international

hostilities, and that is we can't be relying upon

hostile countries for our everyday needs.

So the United States of America needs to make sure

that we are manufacturing everything that we need.

We learned that during the time of Covid, and we

shall not make that mistake again.

Over the last 30-plus years, the U.S.

share of global chip production has plummeted

from 37% to just 12%.

That's because it costs at least 20% more to build

and operate a new fab in the U.S.

than in Asia.

Labor is cheaper there.

The supply chain is more accessible and government

incentives are far greater. The Chips Act

aims to change that, setting aside 52 billion

for companies to manufacture in the U.S.

And Texas hopes to get as much of those federal

dollars as possible.

Since the National Chips Act was introduced in

2020, more than 50 new semiconductor projects

have been announced in the U.S., creating some

44,000 new jobs and totaling more than $210

billion of investment.

More than $61 billion of that is happening in

Texas, with six projects expected to create more

than 8,000 jobs.

The $17 billion Samsung fab we saw being built in

Taylor is one of the two largest projects, but the

biggest investment by far is the $30 billion Texas

Instruments fab coming to Sherman.

For a city of 45,000, that's a huge investment

in our community. Our entire city tax base was

around $4 billion.

This particular space is about 370,000 square feet.

So it's one of our largest, actually our

largest wafer fab that we have in production.

But when it comes to new chip fab investments,

Arizona has taken the lead with a $20 billion

fab coming from Intel and a $40 billion site from

the world's top advanced chipmaker, TSMC.

Still, Texas is in close second, and it's the state

with the highest number of chip fabs in the

country. TI, for instance, has had another

fab in Sherman since 1966.

Texas Instruments went a long way in putting

Sherman on the map.

The support we've had from the state legislature and

then also the federal support in this industry,

Texas continues to be a hub for where we can build

this manufacturing industry.

German-based Infineon Technologies is one of the

world's biggest providers of automotive chips, and

it makes many of them in Austin.

The number of chips in an automotive, in an EV, any

automotive in general is drastically increasing,

and all the connectivity, everything communicating

within the car, around the car is increasing the

chip content in every vehicle.

Infineon has been in the U.S.

for 25 years.

In 2020, it expanded manufacturing in Texas

when it bought Cypress Semiconductor for about

$10 billion, taking over its Austin fab, where we

got a tour.

So it's about two football fields in length, all the

way from the front to the end, and it's close to

100,000 square feet of clean room space.

That's because we're building so many chips at

the same time. We have wafers in here that are

the beginning of their multi-month life in this

fab and wafers that are about to ship out to back

end facilities.

Netherlands-based NXP Semiconductors also has

two fabs in Austin and recently made plans for a

$2.6 billion expansion that would add an

additional four-story Fab.

X-Fab, a chip company that's been in Texas for

more than two decades, also recently announced a

$200 million expansion of its Silicon Carbide fab in

North Texas.

As the world's second biggest maker of advanced

chips, Samsung is a huge draw for other

semiconductor suppliers to come to Texas,

especially with its coming 1,200-acre advanced

fab, north of Austin.

When you start bringing in a fab like that, you need

to build the ecosystem.

And the supply chain is really important.

And there's a lot of discussion these days

about onshoring supply chains.