Texas Election Raises AI Data Center Uncertainty

Democrats made major gains in the U.S. midterm elections, including winning Texas, where Taiwanese contract manufacturers have built up AI server operations. The election raises questions about the supply chain’s expansion plans as Governor-elect Gina Hinojosa has pledged to pause approvals for new data centers until stronger community protections are adopted. Her proposals address water supplies, electricity costs and community oversight, according to The Texas Tribune.

Taiwanese manufacturers are continuing their Texas investments despite the uncertainty. Foxconn, Pegatron, Compal, Wistron and Wiwynn have combined commitments exceeding US$7 billion, Commercial Times reported. Pegatron’s Texas facility is already shipping NVIDIA GB200 and GB300 systems. Compal targets trial production in the fourth quarter of 2026 and mass production in the first quarter of 2027.

TrendForce warns that Texas, Ohio and Georgia could introduce moratoria on new data center projects, and the three states account for a significant share of planned U.S. data centers. Most projects scheduled for 2027 are already under construction, while projects planned for 2028 and beyond face greater delay risks if proposed restrictions take effect.

Foxconn Chairman Young Liu previously said the company operates six factories in Houston, with further expansion underway. Its Texas AI operations include Level 11 rack integration and Level 12 cluster integration; the company’s U.S. and Mexico expansion is driven mainly by new AI business demand, Economic Daily News reported. Wistron opened its D1 factory in Fort Worth in July, its first U.S. manufacturing facility. CEO Jeff Lin expects the larger D2 facility to begin operations in 2027, with a possible D3 depending on orders. Wiwynn opened a facility near El Paso in September and expects a second building to begin production in the second quarter of 2027. Its planned Texas campus calls for more than 1.7 million square feet of floor space.

Democrats made major gains in the U.S. midterm elections, including winning Texas, where Taiwanese contract manufacturers have built up AI server operations. The election raises questions about the supply chain’s expansion plans as Governor-elect Gina Hinojosa has pledged to pause approvals for new data centers until stronger community protections are adopted. Her proposals address water supplies, electricity costs and community oversight, according to The Texas Tribune.

Taiwanese manufacturers are continuing their Texas investments despite the uncertainty. Foxconn, Pegatron, Compal, Wistron and Wiwynn have combined commitments exceeding US$7 billion, Commercial Times reported. Pegatron’s Texas facility is already shipping NVIDIA GB200 and GB300 systems. Compal targets trial production in the fourth quarter of 2026 and mass production in the first quarter of 2027.

TrendForce warns that Texas, Ohio and Georgia could introduce moratoria on new data center projects, and the three states account for a significant share of planned U.S. data centers. Most projects scheduled for 2027 are already under construction, while projects planned for 2028 and beyond face greater delay risks if proposed restrictions take effect.

Foxconn Chairman Young Liu previously said the company operates six factories in Houston, with further expansion underway. Its Texas AI operations include Level 11 rack integration and Level 12 cluster integration; the company’s U.S. and Mexico expansion is driven mainly by new AI business demand, Economic Daily News reported. Wistron opened its D1 factory in Fort Worth in July, its first U.S. manufacturing facility. CEO Jeff Lin expects the larger D2 facility to begin operations in 2027, with a possible D3 depending on orders. Wiwynn opened a facility near El Paso in September and expects a second building to begin production in the second quarter of 2027. Its planned Texas campus calls for more than 1.7 million square feet of floor space.