Pull to refresh
Logo
GlobalFoundries to operate two new New York chip fabs backed by Japan

GlobalFoundries to operate two new New York chip fabs backed by Japan

Money Moves

First project under U.S.-Japan Strategic Investment Initiative; first fab expected online in 2029

Today: GlobalFoundries selected to operate two new fabs

Overview

Updated 46 minutes ago

Japan will invest up to $21 billion to build two semiconductor factories in upstate New York that GlobalFoundries will operate. The first fab, expected to start production in 2029, adds roughly 900,000 wafers of annual capacity.

The deal is the first project under the U.S.-Japan Strategic Investment Initiative, part of a Trump administration trade agreement. Japan funds the fabs, while the U.S. and Japanese governments jointly own them through a special purpose vehicle. GlobalFoundries operates them without putting up capital.

Why it matters

If both fabs come online, the U.S. adds 1.8 million wafers of annual chip capacity, cutting reliance on Asian manufacturing.

Questions about this story

Free account needed to ask — your question is kept and asked for you right after sign-up. Answers are public.

No questions yet — be the first to ask.

Key Indicators

$21B
Total investment from Japan
Up to $21 billion for two fabs at GlobalFoundries' Malta, New York site.
900,000
Annual wafer capacity per fab
Each fab adds roughly 900,000 300mm wafers of annual U.S. capacity.
27,000
Construction and ecosystem jobs
Expected jobs from the project in New York's Capital Region.
4%
U.S. equity stake in GlobalFoundries
Commerce Department receives about 4% equity, rising to 7% per Reuters.
2029
First fab expected online
Construction begins this year; production expected in 2029.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

Sign up to generate historical perspectives on this story.

People Involved

Organizations Involved

Timeline

2025 2029

5 events Latest: Today
Tap a bar to jump to that date
  1. First fab expected to start production

    Upcoming Milestone

    First 300mm fab expected online, adding about 900,000 wafers annual capacity.

  2. Partners to decide on second fab

    Upcoming Decision

    Partners will decide whether to build second factory before end of 2028.

  3. GlobalFoundries selected to operate two new fabs

    Today Announcement

    U.S.-Japan initiative funds up to $21 billion for two fabs at Malta, New York.

  4. Groundbreaking expected at Malta site

    Construction

    GlobalFoundries expects to break ground on first fab later this year.

  5. U.S. and Japan strike trade and investment deal

    Agreement

    Japan agrees to invest $550 billion in the U.S. in return for lower tariffs on Japanese cars and imports.

Scenarios

1

First fab online in 2029, second approved

Likely Resolves by End of 2029

Discussed by: Reuters, GlobalFoundries executives

Construction begins this year at the Malta site. The partners decide on the second fab before end of 2028. If both proceed, the U.S. gains about 1.8 million wafers of annual capacity. GlobalFoundries earns management and technology fees for at least 20 years.

2

Second fab delayed or cancelled

Possible Resolves by End of 2028

Discussed by: Reuters, market analysts

The partners decide before end of 2028 whether to build the second fab. A downturn in chip demand or a shift in U.S.-Japan trade relations could delay or kill it. The first fab would still proceed, but total capacity would be roughly half the original plan.

3

Deal faces political or legal challenges

Possible Resolves by Jan 20, 2027

Discussed by: The Hill, political analysts

The U.S. government takes a 4% equity stake in GlobalFoundries, rising to 7%. A change in administration or a legal challenge to the equity arrangement could complicate the deal. The trade agreement that enabled it could also be renegotiated.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

May 2020 - 2024

TSMC builds Arizona fabs (2020-2024)

Taiwan Semiconductor Manufacturing Company committed to build fabs in Arizona under CHIPS Act incentives. The first fab began production in 2024 after construction delays.

Then

TSMC's Arizona fabs became a centerpiece of U.S. chip onshoring efforts.

Now

Established a model for foreign chipmakers building U.S. capacity with government support.

Why this matters now

Shows the scale and timeline of building new U.S. chip fabs, and the government incentives driving them.

September 1986

U.S.-Japan Semiconductor Agreement (1986)

The U.S. and Japan signed the first major semiconductor trade deal, imposing minimum price floors on Japanese chips and setting a 20% foreign market share target for Japan.

Then

Japanese chipmakers agreed to price floors and market access commitments.

Now

Marked the start of decades of U.S.-Japan semiconductor trade management.

Why this matters now

Shows the long history of U.S.-Japan semiconductor cooperation and tension, now evolving into joint investment.

August 2022

CHIPS and Science Act (2022)

The U.S. passed the CHIPS and Science Act, providing billions in subsidies for domestic semiconductor manufacturing. GlobalFoundries received $1.63 billion in grants.

Then

Kicked off a wave of U.S. fab construction announcements.

Now

The new deal amends GF's CHIPS award, reallocating $955 million to silicon photonics and advanced packaging.

Why this matters now

The U.S.-Japan deal builds on and modifies the CHIPS Act framework.

Sources

(11)