Texas is the second largest state in the US and an economic powerhouse across multiple industries. In 2020, manufacturing output in the state rose by about 94%.  

According to a report by the Texas comptroller this exceeded the growth of the overall state economy and doubled the overall growth of the US manufacturing sector

Multiple manufacturing businesses showcasing Texas sector growth

In addition to the prosperity of the automotive manufacturing sector across the state, Texas also has major manufacturing muscle in other areas.  

As a nationwide leader in chemical production, computer and electronic products, petroleum and coal, and machinery, the opportunities for new manufacturing plants in Texas are numerous and not limited to one industry.  

Computer and electronic manufacturing contribute $28.7bn per annum to Texas’ gross state product (GSP), machinery manufacturing about $19bn, with the petroleum and coal subsectors employing more than 100,000 Texans while contributing approximately $99.5bn to the GSP. 

In early 2023, Rich Products Corporation, a local manufacturing company, announced a new $116.5M investment to expand its manufacturing capacity and warehousing space in Brownsville, Texas, a further boost to the local economy and sector in Texas.

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Within the automotive sector, Texas is the leading member of the Nafta auto corridor initiative, where billions of dollars of assembled vehicles and auto parts are shipped between Mexico and Texas, making manufacturing both a prosperous business and a major employer in the state.  

In addition to auto manufacturing, Texas is also the leader in petroleum and coal products manufacturing in the US. About 30% of the country’s petrochemical refining capacity is from the state, which is also the largest manufacturer of chemical products in the country.  

Austin leading the way for manufacturing in Texas 

Austin, the state capital and the eleventh most populous city in the US, exemplifies and showcases the business-friendly, economic powerhouse that is Texas.  

With existing infrastructures for both traditional and electric vehicle manufacturing coupled with growing demand, Texas is an attractive proposition for setting up a manufacturing business.  

Consistently ranked as one of the best states to start a new business enterprise, Texas is awash with entrepreneurial activity that is stimulating a strong economy within the automotive sector as well as related industries.  

In terms of what makes it a contender for the best place to start an electric vehicle manufacturing plant, Texas offers an array of highly favourable business tax structures and incentives for new and expanding businesses.  

These include no state income tax for employees, allowing businesses to attract employees and reducing costs for start-ups. In terms of expansion, GM is adding its third plant in the US and Tesla recently announced a new location in Austin.  

With established manufacturing companies investing in Texas, the economic forecast for the sector looks propitious for new electric vehicle manufacturing plant businesses. 

Economic growth driving manufacturing business start-ups in Texas 

With $2trn recorded in 2021, Texas boasts the second-largest GDP in the US, bettered only by California. Again, second only to California, Texas is the second largest manufacturing state in the US.  

With a fiercely pro-business climate, agreeable weather, and access to venture capital to attract the attention of entrepreneurs, more and more start-ups are seeing and embracing the advantages of setting up shop in Texas. 

As of 2022, more than 1.2 million workers are employed in the manufacturing sector in Texas, which accounts for about 13% of the workforce in the nationwide industry.  

In terms of the manufacturing output, Texas is responsible for approximately 10% of national manufacturing production.  

With this proportion of the industry already part of the business infrastructure of the state, it is certainly a consideration when it comes to selecting the best place to start a manufacturing business. 

Its diverse and evolving industrial and corporate landscape means that Texas is often considered one of the most attractive locations in the US to start or expand a business.  

As home to numerous Fortune 500 companies, Texas continues to thrive as an economic hub for both manufacturing and many other industries. 

Houston a hub for manufacturing companies

When it comes to cities across Texas, Houston is one of the most important in the manufacturing industry. As of 2022, there were about 3,500 manufacturing companies in the state, with a total employee rollcall of around 250,000.  

When business investors and entrepreneurs are looking for the best place to start a manufacturing business, this kind of industry prosperity and established success in the sector is an attractive proposition.  

Beyond the history of oil and gas, Houston has emerged as a major player in the manufacturing industry, with start-ups and expansions continuing to grow in number. 

With the proposed expansion of the Enterprise Zone Project in 2023 and beyond, an area that encourages new business with tax and financial support and incentives, the manufacturing sector in Texas looks set to grow further.

Information and Data from Global Business Alliance, ARTEXREDI, US Data and Statistics, Images of Texarkana, Texas Business, Arkansas Dept. Of Commerce.