The Biden administration disclosed on Monday its allocation of $1.5 billion to GlobalFoundries (GFS.O) to bolster semiconductor production, aiming to fortify domestic supply chains post the COVID pandemic’s revelations of vulnerabilities.
GlobalFoundries, the globe’s third-largest contract chipmaker, intends to erect a new semiconductor production site in Malta, New York, alongside enlarging existing operations in Malta and Burlington, Vermont, as per an initial accord with the Commerce Department.
This $1.5 million grant will be complemented by $1.6 billion in loans, with the anticipated funding to catalyse a prospective $12.5 billion in investments across the two states, as per the department’s statement.
Officials from the Biden administration averred that the projects, financed under the CHIPS and Science Act, would yield over 10,000 jobs within a decade, emphasising that these positions would offer equitable remuneration and amenities like childcare.
“The chips that GlobalFoundries will produce in these novel facilities are pivotal to our national security,” articulated Commerce Secretary Gina Raimondo during a press briefing.
These chips, diminutive as a fingernail, find utility in satellite and space communications, the defence sector, as well as commonplace applications such as automotive blind spot detection, collision warnings, Wi-Fi, and cellular connections, officials affirmed.
“As an industry, our focus must now shift to augmenting the demand for U.S.-manufactured chips, and cultivating our proficient U.S. semiconductor workforce,” remarked Thomas Caulfield, president and CEO of GlobalFoundries, in a statement.
In September, GlobalFoundries inaugurated a $4 billion semiconductor fabrication plant in Singapore, constituting a substantial global manufacturing expansion.
Raimondo indicated that this marks the government’s third CHIPS announcement, with further funding awards slated for the ensuing weeks and months from the government’s $39 billion programme aimed at enhancing semiconductor manufacturing.
“We are merely at the outset,” she affirmed.
The expansion of the Malta facility will guarantee a consistent supply of chips for automotive suppliers and manufacturers, including General Motors (GM), Raimondo appended.
Moreover, a long-term agreement between GlobalFoundries and GM, disclosed on February 9, secures U.S.-manufactured processors for the automaker, mitigating the risk of chip shortages that impeded millions of vehicle productions during the COVID-19 pandemic.
“Today’s announcement will avert a recurrence of such circumstances,” Raimondo asserted during a briefing on the agreement.
Furthermore, the new Malta facility will manufacture high-value chips presently unavailable in the United States, she added.
She also noted that the upgraded Burlington facility would become the inaugural U.S. site capable of high-volume production of next-generation gallium nitride on silicon semiconductors, integral to electric vehicles, the power grid, and smartphones.