International Finance

Chipmaker GlobalFoundries plans to invest $6 bn to expand in Singapore


US-based chipmaker GlobalFoundries, a chipmaking company, recently announced that they will spend $6 billion to expand capacity at its factories in Singapore, Germany and the US, where there is a high chip shortage, which is hampering the work of automakers and electronics firms globally, according to media reports.

The company also mentioned that apart from investing $6 billion, they also plan on investing an additional $1 billion over the next two years to make sure all the operations run smoothly. The Santa-Clara hearquartered company is owned by the UAE’s state-owned fund Mubadala and the unlisted company’s Singapore operations contribute about a third of its revenue.

GlobalFoundries CEO Thomas Caulfield told the media, “I think the next five to eight years, we’re going to be chasing supply not demand as an industry.” He also added saying that the company is definitely prioritising its customers first.

According to reports, the chip shortage started in late December was caused due to automakers miscalculating demand for semiconductors in the pandemic. This, in turn, led to electronics manufacturers placing more chip orders. Most of the population started working from home, which gave a major boost to the sale of computers and other electronic devices.

Some of the most prominent chipmakers including Intel have previously issued a warning, saying that this shortage has a chance of continuing even next year. They also announced that the company will be investing $20 billion to expand its advanced chip making capacity, while Taiwan’s TSMC announced that they plan on investing $100 billion over the next three years.

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