The Commerce Department grant will support the expansion of GlobalFoundries’s fabs in Malta and New York, as well as the introduction of technology already used by GlobalFoundries’s plants in Singapore and Germany to supply chips to the U.S. automotive industry. GlobalFoundries said the US state of New York had also pledged an additional $550m in support.

GlobalFoundries also plans to build new fabs in New York and Malta “depending on market conditions and customer demand” to produce chips for industries such as automotive, artificial intelligence and aerospace.

“GlobalFoundries’s critical chips are central to securing America’s economy, supply chain and national security,” said Thomas Caulfield, GlobalFoundries’s chief executive Officer. He said U.S. state and federal funding is important to ensure that GF customers have access to U.S.-made chips and can succeed.

Gf, based in New York, is the world’s third-largest contract chipmaker. The company has said it will invest $13 billion in its U.S. manufacturing base over the next dozen years to serve the automotive, smart mobile devices, Internet of Things, data centers and aerospace sectors.

Last week, U.S. Commerce Secretary Gina Raimondo said the Commerce Department is working to finalize as many agreements as possible with the grantees of U.S. Chip and Science Act programs before the inauguration of the next U.S. president, Donald Trump, on Jan. 20. The bill was passed in 2022 and plans to allocate $52.7 billion.

The Commerce Department last week also decided its first major allocation of $6.6bn in government subsidies to TSMC’s US unit. The final grant will be released just weeks before Trump takes office.

So far, the Commerce Department has allocated $36 billion for U.S. chip projects, including $6.4 billion for Samsung, $8.5 billion for Intel and $6.1 billion for Micron Technology.