Taiwan AI suppliers rush to invest in Texas
Taiwan companies that supply giant AI centres in the United States are racing to set up production facilities in Texas, to meet the demand of clients who want locally made material.
The move is part of Taiwan government and corporate strategy to satisfy the demand of President Donald Trump for more manufacturing industry in the U.S., while retaining the highest levels of technology at home.
Last week the U.S. and Taiwan signed a trade agreement that will slash tariffs on the island to 15 per cent in exchange for a US$250-billion investment in the chip industry in the U.S.
“The 15 per cent tariff rate we secured is the most favourable among the countries with the biggest trade surpluses with the U.S. including allies such as Japan, South Korea and the E.U., and will create a level playing field,” the Taiwan government said in a statement.
Taipei needs a close relationship with Trump to secure his protection against a Chinese attack.
According to a survey of 2,000 Taiwan CEOs published in the Commonwealth (天下) magazine last month, new investment in the U.S., principally Texas, will reach a 12-year high this year.
Since 2023, 12 Taiwan firms have committed to investing in Dallas, Houston, Fort Worth and El Paso.
Largest is investment of US$4 billion by Global Wafers Company (全球晶) in a 142-acre site it owns in Sherman, Texas. Last May, it began production of 300 mm silicon wafers. The new investment will enable it to increase production.
Second is Wiwynn Corp (緯穎), a supplier of artificial intelligence (AI) servers and components. It is investing US$300 million in its first manufacturing facility in Texas, in Sorocco, near El Paso.
Wistron (緯創資通), one of the world's largest electronics manufacturers, is investing US$ $761 million in two AI supercomputing facilities at AllianceTexas in Fort Worth. They will begin mass production of motherboards in the first quarter of this year.
The biggest factor driving these Taiwan companies is the astonishing investment in global AI data centres. Late last month S&P Global reported that more than $61 billion had flowed into the centres in 2025, up from $60.8 billion in 2024. The majority are in the U.S.
The Taiwan firms want to be close to their clients, who are increasingly demanding “made in U.S.” parts and components. They also want to avoid future tariffs and other protectionist policies that may be imposed by President Donald Trump.
Why Texas? It has an abundant supply of energy and the price is a third of that in California; personal and corporate taxes are lower. City governments in the state are aggressively courting them.
Plano Mayor John Muns said: “After Toyota moved its North American headquarters here from California, more than 40 Japanese companies followed. Now I am delighted to see more Taiwan companies putting Plano on their investment maps.”
To facilitate the investments, three Taiwan banks have opened offices or branches in Dallas and Houston – E. Sun, Land Bank and CTBC. Last October EVA Air started flying three times a week from Taipei to Dallas, its second destination in Texas after Houston.
But the firms face significant challenges. One is the pace of work. Simon Lai, executive director of the Taiwan Trade and Investment Centre in Dallas, said that the pace of business in Silicon Valley was 70 per cent of that in Taiwan and that in Texas is 70 per cent of that in Silicon Valley. “Patience is essential,” he said.
Most Texas people are unwilling to adapt to the rapid pace of Taiwan’s working culture and insist on working a fixed number of hours each day. One firm summoned staff to a 0700 meeting – but only the Taiwan employees turned up, none of the American ones. They also resist the habit of wearing uniforms with the company logo.
Wages are another challenge. The starting average monthly salary of a blue collar worker in Texas is US$4,000, four times that of a comparable worker in Taiwan. The firms miss the armies of skilful lady assembly workers in China and Southeast Asia.
These high wages push the companies to increase the use of robots and automation. System Electronics’ new plant in Plano needs only three-five people per shift to run its fully automated production line.
These high production costs and substantial initial investment mean that the firms are unlikely to earn a profit in the short term. But they judge that the rapid growth the U.S. AI industry leaves them no alternative but to build manufacturing plants there.
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