U.S. chip foundry announced new manufacturing plant

U.S. semiconductor manufacturer GlobalFoundries made an announcement on Tuesday. In the announcement, they committed to building a new plant in Singapore to meet the unprecedented demand for chips.

GlobalFoundries said that it would develop a new facility in partnership with the Singapore Economic Board with co-investments from committed customers. According to the company, it will invest more than $4 billion in development.

GlobalFoundries CEO Tom Caulfield said their new facility in Singapore would support fast-growing markets in 5G mobility, the automotive, and secure devices with long-term customer agreements already in place.

A global shortage of microchips causes delaying car production. It also affects operations at the largest consumer electronics manufacturers.

Mubadala Investment Company Managing Director, Singapore’s Transport Minister S Iswaran, and Group CEO Khaldoon Khalifa Al Mubarak attended a virtual ceremony for the plant.

A United Arab Emirates state investment company, Mubadala, also owns GlobalFoundries.

Chairman of the Singapore Economic Development Board, Beh Swan Gin, said that the semiconductor industry is a crucial pillar of Singapore’s manufacturing sector, and GlobalFoundries’ new fab investment is a testament to Singapore as global advanced manufacturing and innovation.

Importance of foundries

Semiconductors are considered critical components that give power to all kinds of electronics. This of course includes smartphones and computers and the brake sensors in vehicles. Their production involves a complex network of companies that design chips.

GlobalFoundries cooperates with factories in the Germany, U.S., and Singapore. In other words, Foundries are considered companies that semiconductor companies contract to build chips. GlobalFoundries manufactures designed by AMD, Broadcom, and Qualcomm,

The global chip shortage has highlighted the importance of foundries investing billions in new production lines and upgraded equipment to meet the surge in demand.

Lastly, According to TrendForceTaiwan, Semiconductor Manufacturing Company is the world’s biggest foundry by revenue and market share. In fact, it has around 57% market share, followed by Samsung (19%), UMC (8%), and GlobalFoundries (8%).