SpaceX to make Starlink chips in Austin

SpaceX is moving one of the most shortage-prone parts of Starlink closer to home. The company has started installing equipment at a semiconductor facility in Bastrop, Texas, and Reuters reported that the goal is to start production there by the end of 2026. (reuters.com) The chips in question are radio frequency chips, which are the parts that turn digital data into wireless signals and back again. In a Starlink system, those chips sit in the user terminal and the network hardware that has to talk to satellites moving overhead. (reuters.com) SpaceX is not building a giant silicon wafer factory from scratch in Texas. Reuters said the Bastrop site is for advanced chip packaging, which is the step where finished chips get connected, protected, and turned into usable components, like putting an engine into a car instead of smelting the steel yourself. (reuters.com) That distinction matters because packaging is often where bottlenecks show up first. A company can have chip designs ready and still get stuck waiting for outside suppliers to assemble and allocate the final parts it actually needs to ship hardware. (reuters.com) Starlink is now large enough that those bottlenecks hurt. SpaceX says the network has more than 6 million active customers globally, and in 2025 alone it added more than 4.6 million new active customers and expanded service to 35 additional markets. (starlink.com 1) (starlink.com 2) Every new customer needs ground hardware, not just satellites in orbit. Starlink says its customer kits are manufactured in Bastrop, Texas, so putting chip packaging near the kit factory means more of the hardware chain sits in one place instead of being split across outside vendors. (starlink.com) SpaceX is also trying to raise the network’s capacity at the same time. Starlink says its third-generation satellites are targeted for the first half of 2026, with each satellite designed for more than 1,000 gigabits per second of downlink capacity and more than 200 gigabits per second of uplink capacity. (starlink.com) That creates a two-sided scaling problem. Launching more capable satellites helps the network in space, but SpaceX still has to build enough dishes, routers, and radio hardware on the ground to sign up millions more users without long waits. (starlink.com 1) (starlink.com 2) Reuters said the Bastrop project is expected to handle at least part of the radio frequency chip packaging that outside suppliers do today. That means the first effect is likely to be tighter control over Starlink’s own supply chain, not a sudden flood of extra chips into the broader market. (reuters.com) It also will not happen overnight. Reuters reported that the site is only now being equipped, and production is targeted for the end of 2026, so any relief for Starlink hardware availability would come after months of installation, testing, and ramp-up. (reuters.com) What SpaceX is really buying here is less dependence. If Starlink keeps growing past 6 million users while adding new satellite generations and new countries, owning more of the packaging step gives SpaceX one fewer outside chokepoint between a customer order and a box leaving Bastrop. (starlink.com) (reuters.com)