O’FALLON, Mo. — The world’s third-largest supplier of a crucial piece in electronic devices has expanded its plant here and will soon begin producing a new kind of part that’s aimed at addressing a major shortage that’s devastated global supply chains.
GlobalWafers Co. has completed a $300 million expansion of its O’Fallon, Missouri, plant, which produces wafers that are used in the making of semiconductors, chips and microchips for electronic devices. The company will soon start making larger wafers that can power everything from household appliances to cellphones and automobiles to aerospace technologies.
The specialized, 200- and 300-millimeter wafers — touted by the company as superior to other kinds of wafers — come at a crucial time for manufacturers who are still reeling from a global electronic chip shortage brought on by the COVID-19 pandemic.
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Karla Chaney, general site manager for the O’Fallon plant, said the first wafers will start being produced in the first few months of 2024, and officials expect the expanded plant to be fully operational by the end of 2025.
“We’re already producing sample wafers off of our pilot line for different companies that have requested them,†said Chaney, who added that the company’s wafers are highly sought after because they “provide certain performance enhancements†that competitors don’t offer.
Chaney, along with GlobalWafers CEO Doris Hsu and Tom Caulfield, CEO of Global Foundries, a partner in the project, spoke at an event Monday afternoon celebrating completion of the expansion.
Hsu said her company’s Missouri expansion and ongoing construction of two wafer manufacturing facilities in Texas would not “be possible without the passage of the CHIPS Act†— a law signed last year by President Joe Biden aimed at bolstering American semiconductor research, development and production by offering millions of dollars in manufacturing incentives and billions of dollars for semiconductor research.
Prior to the CHIPS Act passage, the U.S. produced about 10% of the world’s supply of chips, and none of the world’s most advanced ones. East Asian countries, by comparison, produced 75% of the world’s chips.
“These three projects are very expensive but also very significant because they will help us close the gap of the whole semiconductor supply chain in the U.S.,†Hsu said. Most wafers needed for semiconductors are produced in Taiwan, China and Japan, according to officials.
Following the celebration, city and county officials lauded the company’s expansion.
“I’m tickled to death that we have manufacturers that want to grow, that want to invest this kind of money in St. Charles County,†said St. Charles County Executive Steve Ehlmann, who described GlobalWafers’ $300 million investment as one of the “most sizable†corporate investments he has seen in St. Charles County during his five terms as the county’s top elected official.
GlobalWafers’ investment, which was lauded for creating substantial new tax revenue for local governments, was also aided by significant tax incentives offered by the city of O’Fallon. The city granted the company a 50% personal property tax abatement over the next 10 years and offered sales tax abatements on construction materials.
Chaney said the company, which already employees 350 people, intends to hire new workers in phases to staff the expanded plant. The first of those employees is expected to be hired in early 2024.
She said about 50 of those employees will be operators to run the machinery, while a team of 25 employees will be needed to work maintaining and repairing the equipment. The remaining 25 employees will work on engineering of the wafers.
Patrick McKeehan, O’Fallon’s economic development director, and Scott Drachnik, president and CEO of the St. Charles County Economic Development Council, said the new jobs are the continuation of yearslong trend of St. Charles County’s development as a manufacturing hub.
“I don’t think that we would be called flyover country anymore. I think people are really waking up to the possibilities and the benefits of investing in skilled manufacturing here in the Midwest, but specifically here in the ºüÀêÊÓƵ area,†said Drachnick, who also pointed to Boeing’s recent announcement of a $2 billion construction project that is expected to create 500 additional jobs and General Motors’ $1.5 billion investment at its plant in Wentzville.
McKeehan said the industrial complex, which is wedged between Highway 79 and Interstate 70, is home to companies like True Manufacturing, Cosmos Corp., and others that employ around 3,500 people.
And with expansion complete, Chaney said GlobalWafers is already looking at expanding its footprint in O’Fallon again.
“My gut is telling me that we aren’t done growing, at least not yet,†Chaney said.