Besides Sherman, the Taiwan-based parent company GlobalWafers Co. was considering locations in Ohio and South Korea for the facility expected to create 1,500 new jobs.
“That’s why GlobalWafers is waiting to see what happens with the CHIPS Act,” Plyler said, referring to a proposed $52 billion in federal semiconductor manufacturing incentives and research funding.
Those incentives enjoy broad, bipartisan support but have become entangled in unrelated partisan disagreements on Capitol Hill — a situation exasperating to those intent on luring to Texas more chip manufacturing operations and the economic growth that comes with them.
“Frustrating to think that we are so close with a bipartisan bill that just can’t seem to get across the finish line,” Austin Mayor Steve Adler said in an interview earlier this year. “I don’t understand why (it’s stalled). But it needs to happen.”
Adler noted Samsung’s plans to build a $17 billion next-generation semiconductor factory in Taylor, a small town northeast of Austin.
Such facilities bring good-paying jobs that don’t require college degrees, the kind of “middle-skill” jobs that represent “the cavalry coming over the hill” for a local economy, he said.
“Anyone going out to buy a washing machine or a car is having trouble getting those products partly because they can’t get the chips,” John Neuffer, president and CEO of the Semiconductor Industry Association, said in an interview. “So I think that was kind of a revelation for a lot of America, how dependent we are on chips.”
More than 30 years ago the United States was responsible for producing over a third of the world’s semiconductors. Now that share has fallen to 12 percent and is headed lower.
Some of the most advanced chips aren’t made in the United States at all but instead are overwhelmingly produced in Taiwan.
Neuffer attributed the imbalance to other countries’ strategic moves over the years to provide massive manufacturing incentives even as the United States kept a more hands-off approach.
That has produced a situation where it costs up to 50 percent more to build and operate a fabrication facility in the United States than overseas, he said.
Biden administration officials also have been urging lawmakers to resolve their differences and pass the incentives in the name of national security.
Commerce Secretary Gina Raimondo and Defense Secretary Lloyd Austin wrote to congressional leaders last week describing semiconductors as “ground zero” in the country’s technological competition with China.
“Weapon systems employed on the battlefields of today and emerging technologies of tomorrow depend on our access to a steady, secure supply of microelectronics,” they wrote. “Immediate passage will revitalize the domestic semiconductor manufacturing industry and enable game-changing capabilities our war-fighters need.”
TIME IS OF THE ESSENCE
Congress will soon blow town for its August break, and then after Labor Day re-election campaigns start to crowd out thoughts of anything else.
“We just think we enter very perilous territory if we try to deal with this in the lame duck,” Neuffer said, referring to the always-crowded weeks between the election and a new Congress.
Neuffer didn’t want to speak for any particular company or project, but he said a number of the commitments that have been made to build new facilities across the country are based on the expectation that the federal funding would come through.
Raimondo has warned about lost opportunities if Congress doesn’t act, specifically citing the GlobalWafers plant in Sherman as a potential casualty.
During a conference call with reporters Monday morning, Raimondo described Texas as one of the states with the most to gain from the bill’s passage — and one of the most to lose if it remains stalled.
Companies now planning to build and expand operations in Texas if the legislation is approved are being aggressively courted by other countries making their own incentive offers, she said.
“And we know that they’ll take those offers if Congress doesn’t do its job this week, and pass this CHIPS act,” Raimondo said.
She described the situation as an emergency that needs to be addressed immediately, because companies can’t wait any longer to decide where to locate their operations.
“CEOs call me, like the CEO of GlobalWafers, and say ‘We really want to be in America, but if Congress can’t get this done in July, we don’t have faith that they will get it done. We’re out of time and we just have to go elsewhere,’” Raimondo said.
Some facilities in the works, such as the $30 billion, four-factory campus planned by Texas Instruments in Sherman, might move forward regardless of whether the bill passes.
But bolstering federal support for the sector still could increase the success of those operations. Their presence has the potential to transform communities, as evidenced in Sherman.
Plyler said it’s discouraging to see partisan sparring potentially hold up a project like the GlobalWafers plant after all the work that went into securing it.
As the community continues fostering an ecosystem of chip manufacturers and their suppliers, it needs the federal support to keep up with South Korea and Singapore, the mayor said.
“We’re at a huge disadvantage because their national governments can write checks that we at a local level cannot,” Plyler said.
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