The electronics industry expanded rapidly in Texas during the 1950s, when firms in the state ranged from small groups of research scientists in Austin to large corporations employing thousands of people in Dallas, Fort Worth, and Houston. Products ranged from high fidelity phonographs and television sets to defense microwave equipment and computers. Advantages of locating plants in Texas included proximity to markets, cheap labor, good living conditions, freedom from labor strikes, and a favorable tax structure. In the mid-1950s Houston became the home base for most electronics firms, most of which concentrated on geophysical instruments and automation systems. Total sales in that area in 1955 exceeded $10 million. The second major concentration of the electronics industry in the state at that time was in the Dallas-Fort Worth area. Texas Instruments, then the world's only source of high-temperature silicon transistors, reached $28 million in sales in 1955. In that year, TI supplied 85 percent of the transistors used in the newly developed transistor radios. Collins Radio maintained a $2 million plant near Richardson and was involved in the development of the microwave system of televising. Total 1955 sales for the Iowa-based company were $108 million. Texas Electronics became the only manufacturer of television picture tubes in the state and one of six such plants west of the Mississippi River. TI sales were $44 million in 1956 and $67 million the next year. The firm carried out eight mergers in the late 1950s, which boosted its sales by 1959 to $193 million. In the previous year Collins Radio, also of the Dallas area, was awarded a $3.3 million contract for the development of microwave-link installations.
Aided by government contracts, by 1963 Texas had 291 establishments producing electronic parts and equipment. In 1964 Texas Instruments boosted its total annual sales to $233 million. Texas manufacture of electronic navigation and guidance systems, radar, and communication equipment subsequently expanded at an ever-increasing rate. during the late 1960s more than 35,000 people were employed in large or small electronics plants in the Dallas metropolitan area alone. By 1966 Tracor, originally a small group of Austin scientists in the mid-1950s, had expanded its sales to $17 million and had branches in eight states; sales the following year reached $38 million. The war in Vietnam greatly stimulated the manufacture of military equipment at various Texas electronics firms. Developments included chaff-dispensing systems for the United States Navy, chaff units for the United States Air Force, and the development of a sophisticated missile penetration system. Analytical and medical instruments, as well as antisubmarine devices, were manufactured by Tracor.
In the late 1980s Texas became the fourth-largest employer in the American electronics industry. Electronic manufacturing firms employed 154,000 people, who accounted for 16.8 percent of jobs in Texas. The largest electronics industry in Texas was the manufacture of electronic components, followed by radio, TV broadcasting and communication devices. Dallas became the heart of the Texas electronics industry, with 39 percent of the electronic manufacturing firms in the state. Dallas was followed by Houston (19 percent), Austin (14 percent), and Fort Worth (12 percent). See also AERONAUTICS AND AEROSPACE INDUSTRY.