GlobalFoundries Inc. has secured $1.5 billion in funding from the U.S. government to construct a new fab and upgrade two existing chip manufacturing facilities. The grant was announced by the company and will be provided through the CHIPS and Science Act, which allocates $52.7 billion in subsidies to the semiconductor sector. Intel Corp. is also expected to receive financing under the legislation as it plans to invest over $30 billion in new U.S. fabs.
GlobalFoundries currently operates a chip plant in Essex Junction, Vermont, employing over 2,000 workers. The company will use a portion of the grant to expand the capacity of this facility and make it capable of producing gallium nitride chips in large volumes. Gallium nitride chips have a wider bandgap than silicon, allowing them to operate at higher voltages and withstand heat better. These chips are used in various sectors, including electric vehicles, electrical grids, data centers, and wireless networking equipment.
In addition to the Vermont plant, GlobalFoundries will use the funding to finance two other fab projects at its manufacturing campus in Malta, New York. The upgrades will focus on addressing the requirements of auto sector customers, which accounted for 17% of the company’s revenue last quarter. The third project involves building a second fab on the Malta campus to produce chips for multiple markets, including automotive, aerospace, defense, and artificial intelligence.
Once completed, the two plants in New York are expected to have a combined production capacity of 1 million wafers per year. GlobalFoundries aims to triple the capacity of the Malta campus over the next decade. Alongside the $1.5 billion in direct funding, the company will also receive access to $1.6 billion worth of loans. It estimates that these investments will create 1,500 manufacturing jobs and 9,000 construction jobs.
GlobalFoundries CEO Thomas Caulfield emphasized the importance of these investments in making the U.S. semiconductor ecosystem more competitive and resilient. He also highlighted the role they play in establishing the New York Capital Region as a global semiconductor hub.
Intel is also expected to receive CHIPS Act financing for its new fabs being built in the U.S. The company is seeking over $10 billion in grants and loans, and more than 100 other semiconductor industry players have applied for CHIPS Act Funding.
Overall, the funding received by GlobalFoundries and Intel will significantly contribute to the growth and development of the semiconductor industry in the U.S.
