The US Department of Commerce announced on Tuesday, December 17th, that it has finally confirmed a government grant of $406 million to Taiwan’s GlobalWafers to significantly enhance the United States’ silicon wafer production capacity.
This funding will be utilized for projects in Texas and Missouri to establish the first high-volume 300mm advanced semiconductor wafer production line in the US and expand silicon-on-insulator wafer production.
Wafers are a crucial component of advanced semiconductors. This is a significant move by the Biden administration to promote self-sufficiency in the domestic chip supply chain.
The subsidy will support GlobalWafers’ nearly $4 billion investment in these two states to construct new wafer manufacturing facilities, creating 1,700 construction jobs and 880 manufacturing jobs.
GlobalWafers CEO Xu Xiulan stated that considering the tariff pressures on the global chip supply chain, the company believes localization has distinct advantages.
She said, “In countries with high demand for silicon wafers, local supply will be prioritized and supported by local customers.”
When asked if the company is concerned about potential uncertainty in the US CHIPS Act subsidies after President-elect Trump takes office next month, she mentioned that they would observe whether Trump would make new decisions.
She said, “Currently, in addition to the Act, there is also a legally protected contract… as the CHIPS Act was proposed during Trump’s first term, the likelihood of its continuation is higher.”
However, she mentioned that factories set up in the US will not be able to rely entirely on US raw materials and will still need to import some materials and consumables. This situation, coupled with proposed tariffs by Trump, is causing some uncertainty.
She stated, “Some customers have been inquiring about quotes including transportation and tariffs, but due to tariff uncertainties, we cannot provide these quotes.” GlobalWafers operates 18 factories in nine countries.
GlobalWafers is the world’s third-largest wafer manufacturer. The company announced in 2022 its plans to construct a $5 billion factory in Texas to produce 300mm silicon wafers for semiconductors, abandoning investment plans in Germany.
Currently, over 80% of the global 300mm silicon wafer manufacturing market is controlled by five major companies, including GlobalWafers, with about 90% of wafers produced in East Asia.
GlobalWafers plans to construct and expand facilities in Sherman, Texas, to produce wafers for advanced, mature node, and memory chips, and to build a new wafer facility in St. Peters, Missouri, for defense and aerospace chips.
The Department of Commerce is expediting finalization of incentives for the $52.7 billion semiconductor manufacturing and research grant projects provided under the 2022 CHIPS and Science Act before Trump’s inauguration on January 20th.
(This article is based on a report by Reuters)