As the clean energy buildout continues, challenges looming over the industry include shortages and price increases in the transformer market. MGM Transformers and VanTran aim to help fill the critical supply chain gap in the United States by increasing manufacturing capacity of transformers in Waco, Texas.
MGM Transformers acquired VanTran in 2024, and the two announced the opening of a 430,000-square-foot manufacturing facility. The new plant will produce custom liquid-filled transformers. It is expected to create 700 new jobs over the next five years, while reportedly unlocking over $1 billion in annual transformer production capacity.
“With this facility, we’re not just growing — we’re redefining the scale of American manufacturing,” said Doug Banty, CEO of MGM Transformers. “We’re proud to create jobs, reduce lead times, and deliver mission-critical infrastructure — made in America, for America.”
A study conducted by PA Consulting for National Electrical Manufacturers Association (NEMA), “A Reliable Grid for an Electric Future,” predicted that growth in electricity demand in the United States will be driven by data centers and e-mobility, along with industrialization and connectivity. The report forecasted a 300% rise in energy consumption by data centers and a 9,000% for electric mobility and charging.
Transformers are needed to enhance grid infrastructure to handle that growth. A study by the National Renewable Energy Lab (NREL) said it expects the overall distribution transformer capacity needed in 2050 to be between 160% and 260% of 2021 levels. The study projected a need by 2050 for nearly 2 TW of “step-up transformers” used for solar, wind and battery arrays, which have similar characteristics to distribution transformers.
While transformers are needed to handle load growth, the U.S. is not manufacturing enough transformers to keep up with current demand, as aging transformers need replacement. In addition, future imports will be affected by recent tariffs by the Trump administration that use the International Emergency Economic Powers Act (IEEPA) to impose a 25% tariffs on Canada and Mexico, the latter being a supplier to the U.S. supply chain.
VanTran has been manufacturing custom distribution class transformers for decades. With a facility in Waco that currently employs 250 people, the acquisition by MGM Transformers brings expertise in a broad range of inverter technologies with customization for many applications.
“VanTran has demonstrated unwavering dedication to Waco for over 60 years, and we are thrilled that both they and MGM Transformers have chosen our city for this significant expansion,” said Matt Meadors, President and CEO of the Greater Waco Chamber. “Their investment underscores Waco’s appeal as a center for growth and innovation.”
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