Nvidia unveils plans to invest in two new chip factories in Texas
A new factory and new jobs could be coming to North Texas.
Microchips manufacturer Nvidia, a giant in the Graphics Processing Units (GPUs) industry, announced Monday morning that it wants to build two factories in Texas — one in Houston and one in Dallas.
Some economy experts have speculated this might be a move to circumvent tariffs on Taiwan, where the company manufactures most of its computer chips.
Why Nvidia is considering a move to Texas
"Taiwan doesn't really have an energy. Electricity is really very expensive there. It's primarily gas or coal, and one of the great things about coming to Texas is natural gas is really cheap, so I think that has something to do with picking Dallas or Houston," Don Shelly, a business professor at the SMU Cox School of Business, said.
Other President Trump tariffs have also been a big question.
While Nvidia is known for building computer chips, which for now have been exempt, the two Texas factories would be for "A-I supercomputers," which could be subject to something different.
But Shelly thinks tariffs overall won't be a problem.
"It's just not good for commerce; I think everybody realizes that. But there's a big push to say that if you're putting 25% or 30% tariffs on our products, that's not fair. Oh, we want you to reduce them down and try to level the playing field," he said.
In the blog post, Nvidia said it expects production to begin ramping up at the two factories it hasn't built yet.
Moving operations from Asia to the U.S.
Even if they are built relatively quickly, Shelly thinks there might be other issues.
"I suspect it's going to be much more complicated setting up the supply chain here than what they have set up in Asia, just because they've been there so long," Shelly said. "The good news is that will likely mean more jobs for suppliers,"
But he's hopeful the new factories could bring a tech renaissance to North Texas.
"They're calling Phoenix now Silicon Desert. So I don't know, but maybe we can get a similar designation," Shelly said.
