Chip manufacturer Wolfspeed will invest up to $2.5 billion from federal funds, private investment and federal tax credits in the expansion of its silicon carbide fabrication facility in Marcy and in its materials manufacturing facility in North Carolina, federal and company officials announced earlier this week.
“That’s going to make the I-90 corridor America’s semiconductor superhighway,” U.S. Sen. Chuck Schumer, D-NY, said during a Zoom press conference announcing the funding on Tuesday. “One of every four chips made in the U.S. will be made within a few miles of that I-90 corridor that goes from Albany through Utica to Syracuse to Rochester to Buffalo.”
And that is good economic news for the Mohawk Valley, local officials agreed.
“This transformative investment will accelerate hundreds of good-paying jobs in Oneida County and further elevate our region as a leader in semiconductor production,” said Oneida County Executive Anthony Picente Jr. in a statement. “As Wolfspeed enhances its capabilities, we look forward to the opportunities this brings for our workforce and our future in the Mohawk Valley.”
And the benefits of Wolfspeed growth aren’t just economic, Schumer said. Making these chips in the United States, where so much important technology relies on them, is a security issue, too, he said.
“Wolfspeed is leading the pack bringing semiconductor manufacturing back to America,” Schumer said during the Zoom press conference. “And the Mohawk Valley is going to be the beating heart leading that effort.”
About Wolfspeed
Wolfspeed’s fabrication facility in the Marcy Nanocenter, which opened in 2022 , is the first in the world to produce chips on 200mm silicon carbide wafers. Most chip manufacturers use silicon wafers, but silicon carbide offers greater efficiency, making it useful for high-power applications.
Silicon carbide first gained traction in electric vehicles, but is used in many more applications now, including artificial intelligence data centers, solar and wind energy, and military uses with national security implications.
Wolfspeed is building the John Palmour Manufacturing Center for Silicon Carbide in Siler City, North Carolina at which it powered up the first 200mm silicon carbide crystal furnaces, Wolfspeed announced in June. The facility will produce silicon carbide wafers —thin slices of the semiconductor.
“What happens in North Carolina is also important for New York,” Schumer said, “because all the wafers that get made in North Carolina get sent up here to be processed at Marcy.”
About the money
The funding to fuel more rapid growth at Wolfspeed is coming from three sources, according to both a joint announcement made Tuesday by Wolfspeed and the U.S. Department of Commerce, and a separate announcement made by U.S. Sen. Chuck Schumer, D-NY:
- Wolfspeed and the U.S. Department of Commerce signed a non-binding preliminary memorandum of terms for Wolfspeed to receive up to $750 million in federal funds through the federal CHIPS and Science Act. Schumer wrote and sponsored the bipartisan legislation and steered it through passage in 2022.
- That agreement helped Wolfspeed to win $750 million in private financing from a consortium of investment funds led by Apollo, the Baupost Group, Fidelity Management & Research Company and Capital Group.
- And Wolfspeed plans to use the advanced manufacturing tax credit in the CHIPS and Science Act to get nearly $1 billion in cash tax refunds related to construction, expansion and equipment installation in North Carolina and Marcy.
"This support galvanizes our ability to expand domestic manufacturing, accelerate innovation in next-generation semiconductor technology and meet the increasing global demand for silicon carbide," Wolfspeed CEO Gregg Lowe said in a statement. “As a key player in the semiconductor industry, this proposed investment will enable us to solidify our leadership position with a first-of-its-kind 200mm silicon carbide manufacturing footprint in upstate New York and central North Carolina, while contributing to the resilience and competitiveness of the U.S. supply chain.
“It’s not just about growth for Wolfspeed—it’s about driving technological advancement that powers the future.”
Wolfspeed’s Marcy expansion is expected to cost about $790 million and increase the fab’s capacity by 30%. The tax credit will help to pay for the highly expensive, state-of-the-art equipment needed for this expansion, including photolithography tools, ion implanters, metal deposition tools, etch systems and automation equipment, according to information from Schumer’s office.
“The rebirth of Upstate New York’s manufacturing industry continues today,” Governor Kathy Hochul said in a statement. “Now the technology produced in Marcy powers electric vehicles, the 5G revolution and industrial products to help meet our nation-leading sustainability goals. With Wolfspeed as an anchor and investments by my administration in shovel readiness through the FAST NY program, we will bring even more innovative and cutting edge companies to the Mohawk Valley. “
Promise of jobs
State and local officials announced in 2019 that Wolfspeed, then known as Cree, Inc., would build a fabrication facility at the Marcy Nanocenter. The state offered the company $500 million in capital grants in exchange for a $1 billion investment, a pledge of $30 million for research and development, and a commitment to create 614 jobs within eight years.
Projections at the time showed Wolfspeed having 350 jobs in 2024, its second year of operations, said Shawna Papale, acting president of Mohawk Valley EDGE. But Wolfspeed has told MV EDGE that is has more than 500 employees in Marcy already and expects to reach 600 well before the initial projection date of 2028, she said.
“This type of growth will greatly improve the amount of chips manufactured here in New York State and will further tap into our local colleges and universities to offer career paths in semiconductor and advanced manufacturing,” she said. “This was a true collaboration between local, county, state and federal partners over the course of many years to be where we are today.
“Senator Schumer’s vision to build out the semiconductor corridor from Buffalo to Albany is now much more a reality thanks to this investment through the CHIPS and Science Act.”
About CHIPS, science
In writing the legislation, Schumer had upstate New York on his mind and, in parts, Wolfspeed and Marcy, which he called his “North Star” in writing the bill, Schumer said during his press conference.
While writing, he consulted with Wolfspeed officials while he was writing the legislation and was told that they needed an investment tax credit if they were going to expand in the Mohawk Valley, he said.
“So one of the reasons I included provisions like the ITC in the CHIPS and Science bill (was) because I knew it would provide the necessary investment for companies like Wolfspeed to grow in New York,” he said, “and to make sure that advanced chip machinery wouldn’t be located overseas, but rather in places like Marcy.”
The kind of investment Wolfspeed and other semiconductor firms are making in the Mohawk Valley and in other parts of upstate New York will transform the region’s dynamic, Schumer said.
“For too many years, as we know, our parents and grandparents would drop off their kids at the airport in Syracuse or elsewhere and wave goodbye because the kids couldn’t find a good job in Utica, in Syracuse, in the places where they grew up and would want to stay,” Schumer said during his press conference.
“But now that’s being reversed. Not only are there going to be plenty of good-paying jobs for local folks, but we’re going to have such a boom that people from other places are going to say goodbye to their parent at the airport, and fly to the mohawk valley and Central New York.”
Other upstate companies
Wolfspeed is not the only high-tech company in upstate New York to benefit from the CHIPS and Science Act. Edwards Vacuum in Western New York has signed a preliminary memorandum of terms under the act for its new more-than-$300-million dry pump manufacturing facility for the semiconductor industry, the first of its kind in this country, Schumer announced last week.
Micron, which is building a fabrication facility in Clay, reached a $6.1 billion funding agreement with the federal government under the act earlier this year. And GlobalFoundries has an agreement for $1.5 billion in funding to expand and construct a second computer chip factory in Malta.
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More on Wolfspeed's arrival: Wolfspeed is here. Millions in state aid paved the way to a shovel-ready Marcy Nanocenter
The synergy between these companies and their investments, other semiconductors firms that have located upstate and Wolfspeed are creating a dynamic that will attract other advanced manufacturing firms upstate as well and create a secure, high-tech economic future for the area, Schumer said.
“There’s a lot of money flowing into our economy and that’s great, great news,” he said. “Wolfspeed is going to be making America’s future right here in the Mohawk Valley. Everyone from Utica to Rome all the way over to Central New York can have a smile on their face today knowing the community has the spotlight as the builders of our country’s future and of some of the most advanced chips in the whole world.
“This is only the beginning. The best days are ahead for Wolfspeed, for Oneida County, for the Mohawk Valley, for all of upstate.”
This article originally appeared on Observer-Dispatch: How will federal funding help 'America's semiconductor superhighway' pass through Utica?
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