According to Reuters, the U.S. government will allocate $1.5 billion to GlobalFoundries to subsidize its semiconductor production. This is the first significant allocation from the $39 billion fund approved by the U.S. Congress in 2022, aimed at strengthening domestic chip production in the United States.
Under a preliminary agreement with the U.S. Department of Commerce, GlobalFoundries, the world's third-largest chip foundry, plans to build a new semiconductor production facility in Malta, New York, and expand its existing operations in Malta and Burlington, Vermont.
The U.S. Department of Commerce stated that the $1.5 billion allocation to GlobalFoundries will be accompanied by $1.6 billion in loans, with the funds expected to spur a total of $12.5 billion in potential investment across the two states.
Gina Raimondo, the U.S. Secretary of Commerce, stated, "The chips produced by GlobalFoundries in the new factory are critical to our national security." GlobalFoundries' chips are widely used in satellite and space communications, the defense industry, as well as in blind-spot detection and collision warning systems in cars, Wi-Fi, and cellular connections.
"We are engaged in very complex, challenging negotiations with these companies," Raimondo said. "These are highly complex, unprecedented factories. Next-generation investments include factories planned by companies such as TSMC, Samsung, Intel, which are of a scale and complexity never before seen in the United States."
Thomas Caulfield, CEO of GlobalFoundries, stated that there is now a need to increase focus on manufacturing chips in the United States and develop a semiconductor workforce in the country.
Raimondo mentioned that the expansion of the Malta facility will ensure stable chip supply for automotive parts suppliers and manufacturers. Previously, GlobalFoundries and General Motors signed a long-term agreement on February 9th last year to help General Motors avoid shutdowns due to chip shortages similar to those during the pandemic.
Mark Reuss, President of General Motors, stated that GlobalFoundries' investment in New York will ensure a robust supply of semiconductors in the United States and support the country's leadership in automotive innovation. Raimondo added that GlobalFoundries' new factory in Malta will produce high-value chips that are currently not produced in the United States.
