(Bloomberg) -- GlobalWafers Co. plans to build a $5 billion semiconductor silicon-wafer facility that will be the biggest of its kind on American soil, as the country contends with the fallout from a global shortage of chips.
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Construction of the factory that will produce 300-millimeter silicon wafers in Sherman, Texas, is expected to start later this year. Production from the first fab is anticipated as early as 2025, the Hsinchu, Taiwan-based company said in a statement.
Washington is trying to court chip investment after a semiconductor shortage disrupted supplies of everything from cars to smartphones, exposing a reliance on foreign sources. A US review of supply-chain vulnerabilities last year found that while the US maintains a healthy share of chip design and manufacturing equipment, the industry is “highly dependent” on overseas sales, notably in China.
“This investment will represent the first new silicon wafer facility in the US in over two decades and close a critical semiconductor supply-chain gap,” GlobalWafers said.
Read more: China’s Chipmaking Power Grows Despite US Effort to Counter It
These types of wafers are the starting material for all advanced semiconductor fabrication sites and most are currently manufactured in Asia, forcing the US semiconductor industry to rely on imports.
The investment will total $5 billion, the White House said in a statement, confirming an earlier Wall Street Journal report.
Speaking at an investment summit Monday, Commerce Secretary Gina Raimondo said the US currently produces 10% to 12% of the world’s microprocessor chips, down from nearly 40% in earlier years. “We took our eye off the ball,” the secretary said. “We stopped investing in chip manufacturing and chip R&D. And, in search of cheap labor, we watched a lot of our manufacturing leave our shores.”
The Biden administration has for months sought the passage of a bill that would appropriate $52 billion for domestic semiconductor manufacturing. The legislation would provide billions of dollars to boost research and development with an eye toward creating new technologies to help the US stay ahead of a rising China. GlobalWafers could be eligible for funding incentives if the CHIP Act passes.
Raimondo said ensuring that Congress passes the bill is “my No. 1 priority.”
GlobalWafers said its new facility could support as many as 1,500 jobs with production volumes ultimately reaching 1.2 million wafers monthly after multiple stages of equipment installation.
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