By David Shepardson
WASHINGTON (Reuters) – The U.S. Commerce Department said on Wednesday it has finalized a $1.5 billion government grant for GlobalFoundries to expand semiconductor production in Malta, New York and Vermont.
The binding contract for New York-based GlobalFoundries, the world’s third-largest contract chipmaker, completes a preliminary award announced in February after the company said it would invest $13 billion over the next decade in its U.S. manufacturing sites that support the automotive, smart mobile devices, IoT, data centers and aerospace & defense.
Commerce Secretary Gina Raimondo told Reuters last week that the department is rushing to finalize as many final agreements as possible with recipients under the $52.7 billion Chips and Science program established in 2022 before the administration -Biden ends on January 20. “We’re working on it as hard as we can,” Raimondo said.
The Commerce Award will support the expansion of GlobalFoundries Malta, New York factory by adding technologies already in use at GF’s facilities in Singapore and Germany to supply chips for the US automotive industry. New York State has also committed to providing an additional $550 million in aid, GF said.
GF also plans to build a new factory in Malta, New York “in line with market conditions and customer demand” to produce chips for automotive, AI, aerospace and defense.
“GF’s essential chips are at the heart of America’s economy, supply chain and national security,” said GF CEO Thomas Caulfield, citing state and federal funding key “to ensuring our customers have American-made chips they need to succeed and win. “
Trade finalized its first major prize last week: a $6.6 billion government grant for Taiwan Semiconductor Manufacturing Co.’s U.S. unit. The first final awards come just weeks before President-elect Donald Trump, who criticized the program, takes office.
The trade has allocated $36 billion for chip projects, including $6.4 billion for Texas-based Samsung, $8.5 billion for Intel and $6.1 billion for Micron Technology.
On Nov. 1, Commerce imposed a $500,000 fine on GlobalFoundries for sending chips without authorization to a subsidiary of blacklisted Chinese chipmaker SMIC. GF said it regretted the unintentional action.
(Reporting by David Shepardson; Editing by Chizu Nomiyama)
