The Department of Commerce announced the finalization of a CHIPS for America research and development award for GlobalFoundries on Sept. 10, advancing the administration’s effort to secure domestic semiconductor manufacturing capacity. The award moves GlobalFoundries’ CHIPS investment from a preliminary agreement to a binding commitment with secured federal funding.
The finalization marks another step in the implementation of the CHIPS and Science Act, which Congress passed in 2022 to reduce American reliance on foreign-made semiconductors.
GlobalFoundries operates semiconductor fabrication facilities in the United States and is a major supplier to defense, automotive, and consumer electronics markets. Its U.S. manufacturing operations include a major fabrication plant in Malta, New York.
For American consumers and businesses, the CHIPS program addresses a vulnerability exposed during the COVID-era chip shortage, when a lack of domestic manufacturing capacity led to production delays and price increases across industries from automobiles to consumer electronics.
The semiconductor supply chain remains heavily concentrated in East Asia, with Taiwan, South Korea, and China accounting for the majority of global chip production. A conflict or natural disaster affecting those production centers could disrupt vast sectors of the American economy.
The CHIPS program has now finalized major awards with multiple domestic semiconductor manufacturers, moving the initiative from the announcement phase to actual binding commitments and construction.
The research and development focus of the GlobalFoundries award is particularly significant because it targets the innovation pipeline that determines which chips will be manufactured in future years, not just current production capacity.
The Semiconductor Industry Association has estimated that rebuilding domestic chip manufacturing capacity to reduce supply chain vulnerability will require sustained federal investment over a decade or more, making the pace of CHIPS Act implementation a key metric for the program’s ultimate success.