Tokyo just wrote a very large check for American silicon. Japan will invest about $21 billion to build up to two chip factories in New York that will be jointly owned by the U.S. government and Japanese interests and operated by GlobalFoundries, the company said Wednesday (Reuters via Nikkei Asia).
It’s a slice of the broader $550 billion Japan-to-U.S. investment deal struck last year in exchange for cutting tariffs on Japanese cars and other imports from at least 25% to 15%. Japan puts up the capital; Washington takes equity. GlobalFoundries CEO Tim Breen told Reuters the U.S. stake in the Malta, N.Y.–based foundry rises from about 3% to about 7%. Trump posted that the government values that 7% at more than $2 billion, after earlier CHIPS-era grants.
Factory one: construction starts this year, production targeted for 2029, adding annual U.S. capacity for about 900,000 300mm wafers when fully online and more than 1,000 factory jobs in New York. Partners will decide on plant two before end of 2028. Initial customers named: Japan’s Renesas Electronics and Apple.
GlobalFoundries shares jumped more than 4% on the news (up over 39% year to date). The firm will also shift $955 million previously awarded by Washington toward silicon photonics, silicon-germanium, and advanced packaging at existing Malta and Burlington, Vermont sites. Breen said Japanese toolmakers such as Tokyo Electron should see some of the buildout spend flow back into their ecosystem.
Trump picks the Japan-funded projects. Cash flows split evenly until a threshold, then 90% to the U.S. Japan has already announced over $100 billion in projects under the scheme. This one puts wafers — and a bigger Uncle Sam ownership stub — on New York soil.
Sources: Nikkei Asia / Reuters — Japan to invest $21bn in GlobalFoundries New York fabs
Featured image: AI-generated editorial illustration by Bugle Blast.
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