The state of Texas will give Elon Musk’s SpaceX $17.3 million to help expand its Starlink manufacturing facility near Austin.
Gov. Greg Abbott announced the funding on Wednesday. The money will be awarded to SpaceX subsidiary Starlink through Abbott’s Texas Semiconductor Innovation Fund, an incentive program to encourage semiconductor research, development and manufacturing.
Only five grants have been awarded since the $698.3 million fund was created in 2023, the governor’s office told The Texas Newsroom.
The grant to Musk’s SpaceX is the second largest to date. Only Austin-based Silicon Labs, which was awarded $23 million through the program, was awarded a bigger grant. The other grantees have been IntelliEPI in Allen, Dongjin Semichem Texas in Killeen and KoMiCo in Round Round.
SpaceX’s Starlink is estimated to have made $8.2 billion last year, according to an analysis by website Payload Space. This is on top of rocket company SpaceX’s revenue.
The funding will be used to help the SpaceX manufacturing site in rural Bastrop County, about 45 minutes outside of Austin, increase its production of its Starlink kits that allow customers to connect remotely to personal satellite internet service. The SpaceX location there is part of a massive, and growing, corporate compound in the area that also includes the headquarters for social media company X and tunneling firm the Boring Company.
SpaceX COO Gwynne Shotwell, a close colleague of company founder and CEO Musk, said in a statement accompanying the announcement that the grant “will help continue to expand Bastrop’s manufacturing for Starlink to help connect even more people across the state and around the world with high-speed, low-latency internet.”
The expansion at SpaceX’s Bastrop site was in the works long before the grant was announced. Already 700,000 square feet, the facility will double in size this year, according to a company progress report last year.
Abbott, a Republican, said in his announcement the company is actually expected to expand by more than 1 million square feet in the next three years. His office estimated the company’s growth in Bastrop is expected to create 400 jobs and result in more than $280 million in capital investment.
It’s unclear how much of this would be directly due to the grant funding.
Starlink was required to submit an application to receive the grant. The Texas Newsroom has requested a copy of this paperwork.
All grantees must show their projects have the support of the local community, according to the application’s FAQ. State Sen. Charles Schwertner, R-Georgetown, and Rep. Stan Gerdes, R-Smithville, indicated their support in Abbott’s announcement.
“This investment is a game-changer for Bastrop and for Texas,” Gerdes said.
The Texas Newsroom is a public radio journalism collaboration that includes NPR, KERA in North Texas, Houston Public Media, KUT in Austin, Texas Public Radio in San Antonio and other stations across the state.