More companies are expected to follow
By Justin Sayers – Senior Staff Writer, Austin Business Journal
Jul 30, 2025
Updated Jul 30, 2025 9:36am CDT
One of the area’s most prominent companies is angling to designate its Round Rock warehouse as a Foreign Trade Zone — and officials anticipate more companies will do the same amid President Donald Trump’s tariffs plan.
Austin-based Flex Ltd. (Nasdaq: FLEX) on July 29 won approval from the Williamson County Commissioners Court for a non-binding letter of support as the company applies for the designation at its 152,000-square-foot building at 2050 Chisholm Trail, which it moved into last year. SpaceX recently applied for the same designation in Bastrop County.
Flex is a global contract manufacturer, and it moved its HQ to Austin in the last few years. The company is known for making products for other big companies — think Apple, Dell and Microsoft — and works across 30 countries and in industries that include automotive, health, industrial, communications, lifestyle and consumer devices. The company is also recently aiming to expand its data center business.
The foreign trade zone program — under supervision of U.S. Customs and Border Protection — is generally considered the U.S. version of “free-trade zones.” It applies to secure areas in or adjacent to CBP ports of entry where merchandise isn’t subject to duty or excise taxes, meaning goods can be exported freely and are exempt from some taxes or tariffs.
The five-county Austin region is served by Foreign Trade Zone 183, which was established in 1991 to capitalize on the growth of the tech industry and to provide local businesses with a tool to help them compete in the global economy, according to Opportunity Austin. The Foreign Trade Zone of Central Texas Inc. serves as the grantee of FTZ 183 and is run by a board of directors appointed by the cities and chambers in the Austin metro.
“The foreign trade zone is a wonderful tool that’s going to be more popular right now. It allows companies, such as (Flex), to delay tariffs — duties on product that they are bringing in (such as) raw material — and shipping them out. It just gives them an added opportunity to delay paying the tariff,” Dave Porter, executive director of the Williamson County economic development partnership, said during a July 15 Commissioners Court meeting.
Zach Scott, director of workforce and industry development for the Round Rock Chamber, estimated during that meeting that the fiscal impact would be about $10,000 annually between all the applicable taxing jurisdictions. He said it only has impacts on the inventory companies are bringing in for their other manufacturing sites in the area, or that they are holding for export outside the U.S. Only about 5% of the company’s inventory would qualify for the FTZ designation.
Scott, who is on the FTZ board, said Flex currently has 70 employees at the site, and is aiming to reach 170 at full operations. He said that investment would be aided by the program.
He added that the city of Round Rock and Round Rock Independent School District have already issued letters of support.
A representative from Flex declined to comment.
Experts expect more use
Commissioners delayed the vote on the designation for two weeks to get more information after some expressed concern that a rash of companies are going to jump at the opportunity for what they essentially view as an incentive without clawbacks from the county.
Round Rock Chamber President and CEO Jordan Robinson said during the July 29 meeting that when the company picked Williamson County, it was looking at the entire region, and did not ask for incentives with the intention to seek the FTZ designation. She said that this would ultimately help with retention and expansion of the company.
“This is really something that is going to help them continue to grow at that facility,” said Robinson, who is also on the FTZ board. “Currently they are on a lease, so they don’t have to stay in Williamson County. But part of their decision to come where they did was with the understanding that Williamson County is part of the Foreign Trade Zone of Central Texas. So in some ways it is a retention piece as well.”
Ben Ramirez, manager of FTZ 183, said during the July 15 meeting that the entire five-county area the office covers has five users. That includes only one other in Williamson County, Warm Audio LLC, which is in Leander.
Online records show others include SpaceX, Tech Ridge in Austin, Samsung Electronics Co. Ltd. in Austin and Rohr Inc. in San Marcos. Dell Technologies Inc. is listed as not active.
“But because of the changes in the administration and companies seeking to find some type of relief from the imposed tariffs on imported goods, we’re seeing a lot more interest in that program throughout the U.S,” Ramirez said, adding that whether more move forward with it depends on other factors like import duties.
He said a company without the designation has to pay import duties when their product reaches a port in Texas. The designation makes it so companies get to delay import duties until it’s sold to a U.S. customer. That essentially makes it more of a “cash flow” change.
“This exemption just simply delays the collection of this tax to the end user and instead it allows them to take that money to invest in their facility and more employees,” Commissioner Russ Boles said during the July 15 meeting.
Flex has reported solid numbers to start 2025, and company executives said they are aiming to regionalize its manufacturing across the globe amid uncertainties about tariffs and global trade.
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