Japan will bankroll up to $21 billion in new GlobalFoundries chip factories, while Washington pockets a bigger stake in the company.
According to Reuters the deal covers up to two fabs at GlobalFoundries’ Malta site in New York, with Japan providing the investment capital. GlobalFoundries supplies the technology and operates the facilities, giving America’s manufacturing revival a distinctly Japanese funding arrangement.
Construction of the first factory should begin this year, with production expected in 2029 and annual capacity reaching approximately 900,000 300mm wafers. The company will invest about $10 billion to fund that plant, with a similar amount proposed for the second.
The partners will decide whether to proceed with the second factory before the end of 2028. GlobalFoundries expects fees for at least 20 years, starting with $50 million next year for managing construction.
The initiative sits within Japan’s $550 billion US investment agreement, negotiated in exchange for lower American tariffs on Japanese imports. Duties on cars and other goods fell from at least 25 per cent to 15 per cent.
GlobalFoundries chief executive Tim Breen said Washington’s existing three per cent stake in the company will rise to seven per cent. President Donald Trump values that holding at more than $2 billion, following $1.63 billion in government grants.
GlobalFoundries says the project could create about 27,000 construction and related jobs, along with more than 1,000 skilled manufacturing positions. The new capacity targets demand across automotive, industrial and connected infrastructure markets.
“GF was selected because fabs of this scale require more than capital,” Breen said.
Initial customers include Renesas Electronics and the Fruity Cargo Cult Apple, giving the proposed factories customers before the concrete arrives. Some Japanese investment will flow back to equipment suppliers such as Tokyo Electron.
Separately, GlobalFoundries will redirect $955 million from its existing CHIPS Act award towards facilities in New York and Vermont. That money will accelerate investments in silicon photonics, silicon-germanium, and advanced packaging to serve communications infrastructure and data centres.
Under the wider bilateral arrangement, available free cash flows will initially split equally between Japan and the US until they reach an agreed allocation. Washington’s share then rises to 90 per cent.
