Semiconductor wafer fabrication plants—known as “fabs”—take years and billions of dollars to build. Just ask Texas Instruments—it plans to spend $30 billion building four new “fabs” at its semiconductor campus in Sherman, 40 miles north of Dallas.

Today, Dallas-based TI announced an agreement with the U.S. Commerce Department that will help pay for its fab-building efforts, which seek to increase America’s self-reliant semiconductor supply chain. Under the agreement, TI will receive up to $1.6 billion in direct funding through the CHIPS and Science Act to support two 300mm semiconductor wafer fabs under construction in Sherman (SM1 and SM2) along with another one in Lehi, Utah (LFAB2).

TI said it also expects to receive an estimated $6 billion to $8 billion from the U.S. Department of Treasury’s Investment Tax Credit for qualified U.S. manufacturing investments. The direct funding and tax credit will help TI “provide a geopolitically dependable supply of essential analog and embedded processing semiconductors,” the company said.

“The historic CHIPS Act is enabling more semiconductor manufacturing capacity in the U.S., making the semiconductor ecosystem stronger and more resilient,” Haviv Ilan, president and CEO of Texas Instruments, said in a statement. “Our investments further strengthen our competitive advantage in manufacturing and technology as we expand our 300mm manufacturing operations in the U.S. With plans to grow our internal manufacturing to more than 95% by 2030, we’re building geopolitically dependable, 300mm capacity at scale to provide the analog and embedded processing chips our customers will need for years to come.”

Rendering of Texas Instruments’ four planned new 300mm semiconductor wafer fabs in Sherman, Texas. The first two fabs, SM1 and SM2, are currently under construction, with the potential for up to four fabs on the site. [Image: TI]

Why TI’s chips are so essential 

Founded more than 90 years ago, TI  is America’s largest analog and embedded processing semiconductor manufacturer. It says its chips are essential in “nearly every type of electronic device,” from advanced safety and intelligence systems in modern vehicles to medical equipment and smart home appliances.

TI broke ground on the new “fab” plants in Sherman in 2022.

The newly announced CHIPS Act funding will help support TI’s investment of more than $18 billion through 2029. TI says it will use the funding to construct and build Sherman’s SM1 cleanroom and complete pilot line for first production, and construct the shell of the SM2 plant. In Utah, the funding will go toward the construction and buildout of the LFAB2 cleanroom for first production.

TI said the connected, multi-fab sites will benefit from “shared infrastructure, talent and technology sharing, and a strong network of suppliers and community partners.”

When they’re up and running, they’ll produce semiconductors in 28nm to 130nm technology nodes, providing “the optimal cost, performance, power, precision and voltage levels required for TI’s broad portfolio of analog and embedded processing products.”

Rendering of early plans for Texas Instruments’ second 300mm semiconductor wafer fab, LFAB2, located next to the company’s existing fab, LFAB1, in Lehi, Utah. [Image: TI]

2,000 TI jobs to be created across the three plants

The plants in North Texas and Utah are a big economic boon to both regions. TI said the three fabs will create more than 2,000 company jobs, along with thousands of indirect jobs for construction, suppliers, and supporting industries.

In a statement, Gov. Greg Abbott said, “We proud to work with Texas Instruments as they build new semiconductor fabs in Sherman and solidify Texas as the best state for semiconductors. With this latest project, TI is building on its more than 90-year legacy in Texas and adding thousands of good-paying jobs for Texans to manufacture critically important technology.”

U.S. Sen. John Cornyn added that “by investing in semiconductor manufacturing, we are helping secure this vulnerable supply chain, boosting our national security and global competitiveness, and creating new jobs for Texans. The chipmaking capabilities these resources will enable at Texas Instruments will help the U.S. reclaim its leadership role in the critically important semiconductor industry, and I look forward to seeing more Texas-led advancements in the years to come.”

Construction underway on Texas Instruments’ second 300mm semiconductor wafer fab, LFAB2, located next to the company’s existing fab, LFAB1, in Lehi, Utah. [Image: TI]

Commerce Secretary on the investment

“With this proposed investment from the Biden-Harris Administration in TI, a global leader of production for current-generation and mature-node chips, we would help secure the supply chain for these foundational semiconductors that are used in every sector of the U.S. economy, and create tens of thousands of jobs in Texas and Utah,” U.S. Secretary of Commerce Gina Raimondo said in a statement. “The CHIPS for America program will supercharge American technology and innovation and make our country more secure—and TI is expected to be an important part of the success of the Biden-Harris Administration’s work to revitalize semiconductor manufacturing and development in the U.S.”

A race to prepare a chip workforce

TI said it’s working to build a “future-ready workforce” with several initiatives. The company is upskilling current employees, expanding internships, and creating pipeline programs with a focus on building electronic and mechanical skills. TI said it has “robust engagements” with 40 community colleges, high schools, and military institutions across the U.S. to develop future semiconductor talent.

Utah Gov. Spencer Cox said his state “is thrilled that Texas Instruments is expanding its manufacturing presence in the Silicon Slopes, furthering the impact Utahns have on critical semiconductor technology. This investment in semiconductor manufacturing not only creates more jobs, but also brings supply chains back to the United States.”

U.S. Senator Mitt Romney said the CHIPS funding “will further support Texas Instruments’ investment in its new semiconductor fab in Lehi—and enhance Utah’s vital role in our national defense and economic success.”

“I was an original sponsor of the CHIPS and Science Act—which made today’s announcement possible—because in order to compete on the world stage, we must continue to promote innovation, foster scientific talent, and expand research here at home,” Romney added in a statement. “Texas Instruments’ expanded operations will help make the United States more self-reliant for chips essential to our national security and economy.”

Planning for sustainability

TI said its 300mm wafer fabs will be entirely powered by renewable electricity, and are being designed to meet LEED Gold standards for structural efficiency and sustainability, with a goal of reducing waste and improving water and energy consumption “per chip.”

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