Japan, US negotiate up to $19B chip plant run by GlobalFoundries

Japan and the United States are in working-level negotiations to build a semiconductor factory on American soil, a project estimated at ¥2 trillion to ¥3 trillion ($12.9 billion to $19.3 billion) that would be operated by GlobalFoundries ↘ 3.19%, according to a report by Nikkei Asia published Thursday.benzinga+1

The proposed facility would produce logic semiconductors used in automobiles, phones, and industrial equipment, and would represent the first chip-related project under Japan's $550 billion investment commitment to Washington — a pledge Tokyo made as part of the trade agreement that capped U.S. tariffs on most Japanese goods at 15 percent.thenextweb+1

From Energy to Chips

Talks between officials from both governments took place Monday and Tuesday, Benzinga reported, citing the Nikkei account. Until now, Japan's tariff-linked investments have focused on energy infrastructure. The first two installments, totaling $109 billion, were directed toward oil, gas, minerals, nuclear power, and gas-fired power stations.ijr+2

Last month, Japan's trade minister said semiconductors and artificial intelligence would carry "very significant weight" in the next round of declared projects, according to The Next Web. The GlobalFoundries plant would be the first concrete step in that direction.thenextweb

Neither government has made an official public comment on the negotiations, and no location for the plant has been disclosed.thenextweb

GlobalFoundries in Focus

The news comes as GlobalFoundries deepens its ties with Japanese industry. In February, the Malta, New York-based chipmaker expanded a multibillion-dollar manufacturing partnership with Renesas Electronics, granting the Japanese firm access to its FDX, BCD, and CMOS technologies across fabs in the U.S., Germany, and Singapore.gf+1

GlobalFoundries has also been the recipient of growing U.S. government support. The company finalized a $375 million Commerce Department award in September for its quantum computing unit and has a letter of intent for a proposed $300 million silicon photonics award.benzinga

Shares of GlobalFoundries rose in early Thursday trading on the Nasdaq ↗ 0.99%, though the stock has traded well below its 52-week high amid broader investor caution around the semiconductor sector. The company reported second-quarter revenue of $1.79 billion, up 6 percent year over year, with communications infrastructure and data center revenue surging 62 percent.investors.gf+1