Inside the deal that brought Saronic’s $3.2 billion shipyard to the Port of Brownsville

The biggest economic development deal in the history of the Rio Grande Valley — measured by the number of direct private-sector jobs it promises to create — took incentives from every level of government, from the state to a local school board, in addition to a workforce development strategy that leaders are hopeful will pay off in generational wealth for the community. 

The state of Texas allocated $80 million to Saronic Technologies, the Austin-based technology startup, through the state’s self-described deal-closing Texas Enterprise Fund. In exchange, Saronic decided to build its massive Port Alpha hub at the Port of Brownsville, where it promised to create about 10,000 jobs over the next two decades. 

Texas Gov. Gregg Abbott dubbed Saronic’s incoming hub as the “most advanced shipyard in the entire world” as he and the CEO of Saronic spoke about the desire to outpace foreign shipbuilding nations such as China. The project is expected to cost $3.248 billion. There’s even a $78,000 job bonus if the company hires U.S. military veterans. 

Abbott estimated that the company will produce $750 million in payroll to Texas residents. 

“That’s game-changing for the population of Texas,” Abbott said. 

Saronic CEO Dino Mavrookas said the new hub will build ships “at a speed and scale not seen since World War II.”

“This investment is about more than constructing a shipyard. It is about rebuilding the industrial capacity, workforce, and manufacturing advantage required to ensure American maritime leadership for decades to come,” Mavrookas said. “The state of Texas and city of Brownsville give us the foundation to turn that vision into reality.”

How Brownsville won

The Saronic Technologies economic incentive deal includes tax breaks from Cameron County for nearly two decades, the Point Isabel Independent School District for at least a decade, and $10 million from the Greater Brownsville EDC.

The total value of the economic incentive package is about $211 million over four phases beginning in 2029, with incentives tied to job creation.

The company’s economic incentives application indicated it was considering sites in Texas, California and Virginia. Louisiana was also considered early in the process but was not a finalist for Port Alpha.

“We’ve raised a lot of capital where we have the ability to mobilize that capital in a way that impacts communities like Brownsville, but more importantly, we’re not SpaceX. We don’t have an unlimited budget,” Doug Lambert, co-founder and chief operating officer of Saronic, previously said during a public meeting.

Cameron County officials say the project is already life-changing for the Brownsville community and across the Rio Grande Valley. 

“This place is going to be front and center stage for a lot of these defense projects, and it’s very exciting because we’re asking ourselves that question: what will [Brownsville] look like 10 years from now? We think we have an idea, but we’re definitely working to create that future for us,” Gilberto Salinas, CEO of the Greater Brownsville Economic Development Corporation, said. “Ten years out, they have the potential to be the largest employer, but let’s not forget about SpaceX, bordering at about 5,000 employees, and they continue to grow.” 

On the workforce side of the equation, Greater Brownsville EDC officials met with all the training and education leaders to hash out whether there are enough graduates in the fields needed by companies like Saronic to fill the need of 1,000 jobs a year for the next decade. 

Salinas said they did the math several times and were confident that the community was training enough future employees with the skills needed to succeed in technology, defense, and artificial intelligence. 

Saronic previously outlined the types of jobs it expects to create, from welders to administrators, with a minimum wage of $25 an hour and an average closer to $36 an hour. The average annual wage for the Brownsville project is expected to be about $75,500, according to the company’s application.

The company also said employees will be eligible for company stock and plans to expand into the commercial market to reduce reliance on defense industry contracts.

Saronic pledged that 35% of its workforce will be Cameron County residents and said it would participate in local job fairs and educational training.

For comparison, the median household income in Cameron County is roughly equivalent to about $24 an hour, according to Workforce Solutions.

Salinas said he and the board of directors were so confident that it was a good deal for the future of the community, that they spent nearly the entire budget for economic incentives on Saronic because of the dividends. 

The EDC generates cash flow from sales taxes, so if there are more workers in the community spending money, the share could increase the EDC’s annual budget for new incentives to attract more companies. 

“Having Saronic in our community is a historic moment for our region and a game changer for our students,” Point Isabel Independent School District Superintendent Teri Capistran said. “Families in the Rio Grande Valley are among the most economically disadvantaged in the state of Texas, but education remains the greatest equalizer that breaks cycles of poverty in families and generations. By partnering with Saronic, our students will now have the unprecedented opportunity to earn advanced degrees, gain cutting-edge skills, and secure high-paying careers right here at home.”

Port of Brownsville officials estimate that the need for federally and state funded infrastructure will increase, and the likelihood of expanding Texas Highways 4 and 48 are very likely — even beyond the projected plans. 

The only road to SpaceX, for example, is already slated to become four lanes, but with Saronic now a reality, that expansion might not be wide enough to accommodate traffic flow. 

In the meantime, it’s about focusing on the workforce and retaining the company. 

“In the future, we’re talking about generational wealth, something that’s been pretty much nonexistent,” Port of Brownsville CEO William Dietrich said. “We’re talking about $160 billion being put in the local region just because this project is here. That amount of money tends to change the demographic needle.” 

Defense manufacturing

Greater Brownsville EDC estimates the Saronic shipyard could generate a $4.9 billion economic impact, support 20,000 jobs when indirect employment is included and generate $1.4 billion in annual wages.

Saronic, founded in 2022 and backed by $845 million in investor capital, aims to build a next-generation shipyard to manufacture autonomous vessels for the U.S. Navy and commercial customers.

The Trump administration’s Big Beautiful Bill included billions for autonomous naval defense technology, including $2.1 billion for medium-sized unmanned surface vessels, $1.7 billion for shipbuilding workforce development and $1.3 billion to expand unmanned vehicle production.

Last year, the U.S. Navy awarded Saronic a $394 million contract to produce autonomous surface vessels through 2031.

The Navy contract is for its Corsair drone boat, which is 24 feet long, can carry 1,000 pounds for more than 1,000 nautical miles and was developed from prototype to production in less than a year, according to the Navy.

Unlike traditional vessels that rely on a ship captain, Saronic’s autonomous vessels navigate using cameras, radar and computer programming models. Operating in open-ocean environments presents unique challenges because communications are limited and saltwater can interfere with antenna signals, company officials said.