ON Semiconductor will expand operations in New York State by purchasing and preserving the existing GLOBALFOUNDRIES Fab 10 manufacturing facility located in East Fishkill, Dutchess County, New York.
According to Governor Andrew M. Cuomo’s office, ON Semiconductor committed to invest more than $720 million over 10 years in the East Fishkill facility to establish its first 300mm chip manufacturing plant, further fueling strategic growth for the company in the areas of power management including automotive electrification, 5G mobile networks, cloud computing and alternative energy.
"ON Semiconductor's decision to expand and grow its operations in New York State is proof positive that smart investments in our innovation economy are working and fueling New York's unprecedented growth," Governor Cuomo said. "We're glad ON Semiconductor is choosing to deepen its roots here and its commitment to New York State."
"This agreement with ON Semiconductor continues to advance the high-tech industry in the Hudson Valley," said Lieutenant Governor Kathy Hochul."The company's investment will further advance chip manufacturing in New York State and add over 100 jobs and retain nearly 1,000 in Dutchess County. We are committed to ensuring the continued growth of the industry and strengthening the economy of New York State."
The company will be shifting production from Fab 10 to their other facilities including Fab 8 in Malta, New York. The State has helped to secure a 3.5 year transition path between GLOBALFOUNDRIES and ON Semiconductor that will ensure Fab 10's continued operation and $720 million in new capital spending at the East Fishkill facility.
At the end of the transition period, ON Semiconductor has committed to hiring from GLOBALFOUNDRIES a minimum of the site's 950 employees that directly support Fab 10 operations and also plans to create approximately 150 new, well-paying jobs in the Mid-Hudson region.
In exchange for ON Semiconductor's commitments, Empire State Development has offered to provide up to $17.5 million in grants toward the purchase of the Fab 10 property, facilities and certain manufacturing equipment, and $22.5M in Excelsior Jobs Program tax credits related to its investment, new hiring and research and development over ten years. Award of both the grant and the Excelsior tax credits are contingent on ON Semiconductor meeting its job and investment commitments.
GLOBALFOUNDRIES and ON Semiconductor will enter into a foundry supply arrangement whereby GLOBALFOUNDRIES will manufacture ON Semiconductor-specific chips at Fab 10 from mid-2019 through 2022 as ON Semiconductor increases staff and equipment installations each year.
"The increased level of capability and capacity enabled by this expansion is our answer to meet critical market needs," said Keith Jackson, President & CEO at ON Semiconductor. "This expansion would have not been possible without the support and grant from Empire State Development and their willingness to partner with us.
"GLOBALFOUNDRIES and Empire State Development have built a strong partnership in the more than 10 years that we have worked together to develop and grow semiconductor jobs and manufacturing in the state," said Tom Caulfield, CEO of GLOBALFOUNDRIES. "We see this transaction as a real win for all parties. For New York State it helps to retain talent and manufacturing jobs for decades to come, for ON Semiconductor they establish their first 300mm facility and a win for GLOBALFOUNDRIES because it frees up resources to allow us to further invest in our Fab 8 Malta, NY facility while preserving our talented workforce in East Fishkill."