Taiwan’s GlobalWafers will spend $5 billion (roughly Rs.39,320 crore) on a new plant in Texas to make silicon wafers used in semiconductors, switching to the United States after a failed European investment.

The company said late Monday the new plant, manufacturing 300-milimetre silicon wafers, would start being built later this year and generate as many as 1,500 jobs in Sherman, Texas.

“With the global chips shortage and ongoing geopolitical concerns, GlobalWafers is taking this opportunity to address the United States semiconductor supply chain resiliency issue by building an advanced node, state-of-the-art, 300-milimetre silicon wafer factory,” Chairwoman and CEO Doris Hsu said.

“Instead of importing wafers from Asia, GlobalWafers USA (GWA) will produce and supply wafers locally.”

The company added that the investment will be done “phase by phase” based on confirming actual customer demand. GlobalWafers said in February it expected its total capital expenditure to reach T$100 billion (roughly Rs. 26,574 crore) between 2022 and 2024, redirecting funds for a now-ended 4.35-billion-euro (36,165 crore) takeover of Germany’s Siltronic. The failed acquisition came as a global shortage of semiconductors has laid bare Europe’s dependence on Asian suppliers, which has triggered recent efforts to boost production across the continent. Germany’s Economy Ministry said it was not possible to complete all the steps of the investment review, in particular a review of an antitrust approval granted by China only in January.

The GlobalWafers deal would have created the second-largest maker of 300-milimetre wafers, behind Japan’s Shin-Etsu, as the semiconductor industry consolidates. Germany has become wary of changes to its high-tech supply network after carmakers, one of its major sectors, were hit by the global chip shortage. GlobalWafers secured a majority stake in Siltronic last year and initially hoped to have the transaction wrapped up in late 2021.

© Thomson Reuters 2022