[Taiwan Chip News] GlobalWafers Secures US Subsidies... "Benefits Maintained Even in Trump Era"

Receiving 35% Support of Total US Investment
Chairman Shishuran: "Expecting Strengthened Manufacturing Capabilities in the US"
Texas and Missouri Plants to Increase Production in Q4 Next Year

GlobalWafers, Taiwan's largest and the world's third-largest semiconductor silicon wafer manufacturer, recently announced that it has signed a subsidy contract under the U.S. CHIPS Act. As a result, GlobalWafers is expected to strengthen its manufacturing capabilities in the U.S. by receiving up to $406 million (approximately 600 billion KRW) in subsidies and a 25% tax credit benefit.

Taiwan GlobalWafers CEO Hsu Shu-lan Reuters Yonhap News

GlobalWafers is the second Taiwanese semiconductor company, after TSMC, to receive subsidies from the U.S. government. The $406 million subsidy accounts for about 35% of GlobalWafers' total investment in the U.S. It comes from the commercial manufacturing facility support program under the U.S. CHIPS Act. The subsidy will be used to build a new 12-inch wafer factory in Texas and to expand production capacity of silicon-on-insulator (SOI) wafers used in defense and aerospace sectors in Missouri.

The U.S. Department of Commerce plans to disburse the subsidy gradually over several years according to GlobalWafers' planned schedule. GlobalWafers Chairman Hsu Shu-lan expects the first phase goals to be achievable by the first half of next year and is optimistic that the first subsidy payment will be received by the end of next year. She also added that the new Texas factory had already broken ground in December 2022.

The company explained that about 80% of the production capacity in the first phase of the new Texas factory has already been reserved by customers. Sample certification is scheduled from the end of this year to the first quarter of next year, with small-scale production starting in the first half of next year according to customer plans, and production volume gradually increasing from the fourth quarter of the same year. Regarding the 12-inch SOI wafer production at the Missouri plant, about 90% has been reserved, with certification expected to be completed in the first half of next year, mass production starting in the fourth quarter, and shipments significantly increasing in 2026.

Chairman Hsu emphasized that there are only about three suppliers of SOI wafers in the global market, and the Missouri plant is the only SOI wafer production facility in the U.S. SOI wafers are used in various fields such as military industry, silicon photonics, and microelectromechanical systems (MEMS) sensors. Due to their high unit price, they are expected to have significant growth potential in the future.

Regarding whether the tariff policies of the second Donald Trump administration, starting in January next year, will affect U.S. plant operations, Chairman Hsu said, "The scope and rates of tariff policies are still unclear." She noted that some customers have requested new pricing that includes transportation costs and tariffs, but under the current circumstances, it is difficult to accept such methods. However, she emphasized that GlobalWafers already has a factory established in the U.S., which is a significant advantage from the Trump era.

On whether President-elect Trump's inauguration will affect the subsidies, she said, "The two plants in the U.S. were established long ago and operate under contracts with the U.S. government," expressing optimism that the current semiconductor law will remain in effect despite the change in administration.

Chairman Hsu candidly admitted that the overall costs of the new U.S. plants are relatively higher compared to other regions. While there is little difference in equipment costs, construction costs are significantly higher. She expects that due to depreciation costs being reflected, the U.S. plant costs will be higher than those in Asia for the next 3 to 5 years. However, since electricity rates in Texas and Missouri are lower than in Taiwan and there are subsidies and other supports, the depreciation cost reduction rate is expected to be faster than that of Asian plants.

Taiwan Economic Daily News ? Reporter Zhong Huiling / Translation by Asia Economy

※ This article is reprinted based on a strategic partnership between this publication and Taiwan Economic Daily News.