GlobalFoundries Gets $1.5B CHIPS Act Funds for US Expansion

The Biden administration has earmarked $1.5 billion in funds for GlobalFoundries to increase semiconductor production under the CHIPS Act. GlobalFoundries, a spin-off from AMD in 2009, also has access to $1.6 billion in loans, courtesy of the CHIPS Program Office. This funding will be distributed across three distinct projects.

Initiating with the establishment of a new production facility in Malta, New York, GlobalFoundries intends to create “high value technologies not currently available in the US,” an objective highlighted by the Department of Commerce. Specializing in the construction of chips for multiple applications and sectors, such as automotive, aerospace, defense and AI, the building of this facility is expected to commence in 2025.

For its second project, GlobalFoundries aims to increase its presence in Malta, New York, by incorporating technologies from its production sites in Singapore and Germany. This expansion is directed towards enhancing the semiconductor production for vehicles. Coupled with the building of a new plant, these developments will enable GlobalFoundries to triple its operational capacity in Malta in the next ten years. When the projects reach their culmination, the company plans to elevate wafer production to 1 million per year across all plants.

Lastly, the remaining funds will be deployed towards the modernization of an existing facility in Burlington, Vermont. This project seeks to create the first US plant dedicated to the high-volume production of next-gen gallium nitride on silicon semiconductors for various sectors such as electric vehicles and smartphones, among others.

GlobalFoundries has pledged to pour $12 billion into these ventures, with the full support of public-private partnerships over the next decade. The sites also have $575 million worth of backing in the form of performance-based Green CHIPS tax credits from New York, along with at least $30 million in investment from the New York Power Authority.

According to the Department of Commerce, these elaborate projects are anticipated to generate about 1,500 manufacturing jobs as well as approximately 9,000 construction jobs over the next ten years. These newly created roles will aim to offer reasonable wages and benefits like childcare.

One of the primary objectives of the CHIPS Act is to strengthen domestic semiconductor supply chains. GlobalFoundries continues to stand out as the only US-based company capable of supplying “current and mature foundry capabilities” at its scale, out of the four global companies outside of China capable of doing so.

Last year, the company came to an agreement with car manufacturing behemoth, General Motors (GM), to provide US-built processors as a means to circumnavigate chip scarcities that led to substantial manufacturing delays in the wake of the COVID-19 crisis. Other major deals included one with Ford in 2021.