Biden administration to contribute $1.5 billion to establish new computer chip factory
The Biden administration recently unveiled plans to allocate $1.5 billion to construct a new computer chip factory in New York state, as part of the Chips and Science Act. This Act, signed by President Biden in 2022, aims to revive American semiconductor manufacturing by providing funds to boost the country’s ability to mass-produce essential electronic components.
The grant marks the third announced under the $52 billion Chips and Science Act and is designed to address the decades-long decline of U.S. chip manufacturing, which has led to concerns about the country’s overreliance on foreign manufacturers. The funding will help semiconductor giant GlobalFoundries build a large-scale manufacturing facility, known as a “fab,” at its headquarters in Malta, New York, to produce advanced chips not currently manufactured in the United States. It will also support the expansion and modernization of other GlobalFoundries plants in the country.
The decline of U.S. chip manufacturing, combined with China’s rapidly growing capabilities, has raised concerns about the domestic supply chain for modern electronics. The grant to GlobalFoundries comes as part of a larger effort by the United States to regain leadership in semiconductor production and ensure its ability to produce critical chips for industry and defense.
Amid concerns about a global chip shortage during the COVID-19 pandemic and broader supply chain risks due to geopolitical tensions, the funding for semiconductor manufacturing is seen as a crucial step to guarantee the United States‘ ability to produce necessary technologies.
The increase in funding also represents significant potential for job creation, with officials estimating that the projects will create about 1,500 manufacturing jobs and 9,000 construction jobs.
The grant to GlobalFoundries is the largest under the Chips and Science Act and represents a commitment by the United States to support its semiconductor industry. The Biden administration also plans to make an additional $1.6 billion in loans available to GlobalFoundries for construction and improvements, and approximately $10 million to support workforce development efforts.
The drive to boost American semiconductor manufacturing is part of the Administration’s broader effort to ensure the production of essential chips for the country’s industry and defense. The investments are seen as a critical step in regaining competitiveness in semiconductor manufacturing and adapting to new changes in the industry.
The announcement of the funding for GlobalFoundries is expected to be followed by more awards under the Chip Act in the coming weeks, as the United States seeks to revitalize its semiconductor industry and regain its position as a leader in chip manufacturing.