Central Texas Global Business Pulse - September 22nd 2024 - Big Plan

Central Texas Global Business Pulse

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US awards $3 billion for EV battery production in Texas, 13 other states

The Biden administration is awarding over $3 billion to U.S. companies to boost domestic production of advanced batteries and other materials used for electric vehicles, part of a continuing push to reduce China’s global dominance in battery production for EVs and other electronics.

The grants will fund a total of 25 projects in 14 states, including battleground states such as Michigan and North Carolina, as well as Ohio, Texas, South Carolina and Louisiana.

Microsoft, BlackRock to launch $30 billion fund for AI infrastructure

BlackRock (BLK.N) and Microsoft (MSFT.O) plan to launch a more than $30 billion fund to invest in artificial intelligence infrastructure to build data centers and energy projects, the companies said on Tuesday.

AI models, especially those used for deep learning and large-scale data processing, require substantial computational power, leading to higher energy consumption.

The computing requirements for AI have dictated that tech companies string together thousands of chips in clusters to achieve the necessary amount of data crunching power, leading to a surge in the demand for these specialized data centers.

Close to $2B in contracts set to be awarded for Austin-Bergstrom International Airport expansion

Nearly $2 billion in contracts for the expansion of Austin-Bergstrom International Airport are set to be considered by the City Council on Sept. 26.

The contracts — totaling $1.89 billion — would fund key elements of the effort, such as a new airport concourse. In August, the council approved about $500 million in other contracts related to the expansion.

The highest priced item on the council's Sept. 26 agenda is a $1.03 billion contract with Hensel Phelps Construction for construction of a new concourse and accompanying tunnel.

Big Plan Highlights

Grateful to the Texas First Lady and the Texas Association of Business (TAB) for hosting an inspiring evening with Texas business community leaders at the Governor's Mansion. It was enjoyable to hear fascinating anecdotes from the Governor and the First Lady's recent trip to Asia, showcasing the continued efforts to strengthen global business ties and promote Texas on the world stage.

News & Updates

International

In U.S. trade war with China, Mexico is emerging as the big winner

A CNBC analysis of recent trade data shows an increase in the flows between China and Mexico of assembled products, and materials and components used in Chinese manufacturing. Experts say that it can be described as a “back door” into the U.S. to avoid Trump and Biden administration tariffs, but also stress that it is entirely legal based on existing trade laws.

There are other factors at play in Mexico’s rapid rise in the global supply chain, from the immediate threat of East Coast port labor strikes to longer-term evolution of logistics strategy tied to global risks, such as nearshoring, and changes in trade law and policy.

Malaysia must tread fine line in EV push amid US-China rivalry, trade tensions: minister

Malaysia must navigate global trade tensions carefully as it seeks to sustain competition in its electric-vehicle sector through incentives for local manufacturers and lure investment, according to its Investment, Trade and Industry Minister Tengku Zafrul Aziz. In an exclusive interview with This Week in Asia, Zafrul warned that if tensions between the United States and China came to a head “in terms of a war on tech supply”, the “whole world”, not just Malaysia or Asean, would be affected.

With expansion in India, Apple bolsters global manufacturing

Apple's release this month of its iPhone 16, new Apple Watch, and AirPods, is creating a buzz among consumers. This year's lineup also marks something else that's new — the role India played in Apple's global rollout as a manufacturer of the iPhone Pro for the first time.

That milestone comes as global corporations are seeking to diversify their production away from China and as competition between the two Asian rivals heats up, analysts say.

USA

S. Korean, US Envoys Visit Michigan, Texas, Arizona to Stress Technology Cooperation

The top envoys of South Korea and the United States visited three U.S. states to stress the alliance of the two nations and technology cooperation. South Korean Ambassador to the United States Cho Hyun-dong and U.S. Ambassador to Seoul Philip Goldberg visited Michigan, Texas and Arizona together from last Monday to Saturday.

During the trip to these major U.S. states, the top envoys held the "Ambassadors' Dialogue," an event in which the two met state governors, regional businesspeople and figures from academia with the aim of enhancing mutual understanding and bilateral relations.

New Mexico port ready to capture Texas truck traffic

When Texas truck inspections slowed traffic to a crawl at El Paso’s commercial ports of entry in April 2022 and September 2023, the Santa Teresa, New Mexico, border crossing picked up the slack.

According to the Chihuahua Bridge Trust, fewer than 800 cargo trucks crossed into the U.S. from Mexico through the Ysleta port of entry and only 220 through Tornillo, Texas, during the Texas “enhanced” inspections. That compares to the nearly 1,500 clearing Santa Teresa – which sits on a state that showed no interest in following Texas Gov. Greg Abbott’s crackdown in the middle of a particularly substantial migrant surge from Mexico.

How a Tariff Rule Aimed at China Could Affect U.S. Ad Spending

The Biden administration’s plan to restrict a trade provision known as the de minimis exemption could make it harder for China-founded e-commerce companies like Temu and Shein to ship to the U.S.—and could gum up an engine of recent U.S. advertising growth.

The exemption allows shipments valued at $800 or less to enter the U.S. without duty and with little scrutiny. But under a new rule the administration said it plans to propose, parcels containing merchandise that would be subject to tariffs under trade law will no longer be eligible for de minimis treatment. About 70% of Chinese textile and apparel shipments are subject to those tariffs and will now have to go through more formal channels to enter the U.S., administration officials said.

Texas

Texas soon to top nation in fast-growing energy resource

There's a lot you can fit in the 268,820 square miles of Texas, including endless highways, cattle ranches and enormous metropolitan areas. In recent years, though, some of that space has been filled with batteries designed to boost the state's energy resources. According to a new report, that battery storage is likely to soon top the nation.

The United States Energy Information Administration (EIA) recently revealed that Texas and California lead the U.S. in power sector battery energy storage systems (BESS), per a Reuters report. While Texas' 4,832 megawatts (MW) of battery systems is currently in second place behind the Golden State's 9,920 MW, energy experts anticipate that the Lone Star State will soon overtake California.

Google signs solar energy deals in Nebraska and Texas

In a blog post this week, the search and cloud giant said it has worked with Omaha Public Power District (OPPD) on a procurement framework that enables Google to supply carbon-free energy to OPPD.

Through this framework, Google has signed a deal with NextEra Energy to offtake from the Pierce County Energy Center; a 420MW solar system and a 680MWh battery energy storage system (BESS) in northeast Nebraska that is expected to come online in 2027.

Austin

Social media company X cites Bastrop address as its official headquarters

The world's richest man is trading high-rise offices in San Francisco for a more modest Texas building with views of an empty field.

Elon Musk's X has named Bastrop as its headquarters — at least temporarily. It cited a location near the small city southeast of Austin as its official address in a recent California court filing.

Opinion Editorial

How immigrants boost ‘trade in value added’ for the global economy

As the 2024 US general election approaches, international trade has emerged as a pivotal issue, with presidential candidates Vice President Kamala Harris and former President Donald Trump navigating a complex web of global trade dynamics, from shifting supply chains and geopolitical tensions to emerging markets and trade agreements as they make their case for election. Engaged voters will be keenly aware that the approach taken by the winner of the presidential contest will have profound implications not only for the US economy but also for the nation’s standing in the global arena.

USTR Finalizes Section 301 Tariffs on Chinese Imports with a Focus on Products from “Strategic Sectors”

On September 13, 2024 USTR announced modifications to the tariffs originally imposed under Section 301 of the Trade Act of 1974 to pressure China to eliminate unreasonable policies and practices related to technology transfer and intellectual property protection. The changes reflect a comprehensive review of the duties required by statute.

The Future Of Global Trade: Multipolarity, Digitalization, And Sustainability – Analysis

Global trade has consistently served as a pivotal driver of the world economy, shaping inter-state relationships, influencing domestic policies, and facilitating innovation. As for 2024, the complexities of global trade have intensified, characterised by fragmentation and a pronounced rise in multipolar competition, accelerated digital trade expansion, and a heightened focus on sustainability.

Events

MOVE America (Sep 24 - 25)

Small Business Connection Conference (Sept 25 at 7:30 am - 2:30 pm)

Texas-EU Business Summit 2024 (Oct 3)

State of the City (Oct 15th at 8am to 10 am)

Tagged airlines, asia, austin, austintx, battery, china, cleantech, economicdevelopment, entrepreneurship, minorityownedbusiness, news, smallbusiness, solar, southkorea, supplychain, tariff, technews, texas, tx, usa, williamson