Lockheed Martin [LMT] and semiconductor manufacturer GlobalFoundries
[GFS] on Monday said they are strategically collaborating to strengthen the U.S. industrial base for computer chips and bolster the defense contractor’s ability to serve its national security customers.
The partnership is intended to help incentivize the domestic semiconductor supply chain, in part by using GF’s chips to meet defense needs.
“Lockheed Martin is focused on delivering cutting-edge 21st Century security capabilities that advance deterrence and keep our customers ahead of emerging threats,” Jim Taiclet, the company’s chairman, president, and CEO, said in a statement. “This begins with securely manufactured semiconductors. We look forward to working with GlobalFoundries to help increase access to domestically produced microelectronics, a true national security imperative.”
GF, which is based in New York and has operations in Germany, operates manufacturing facilities in New York and Vermont that are accredited and authorized by the U.S. government to produce secure ships in sensitive national security systems.
The COVID-19 pandemic began in early 2020 and lasted several years, upsetting global labor markets and supply chains to this day. Most of the microelectronics used in the U.S. are produced overseas. The combination of the pandemic and reliance on foreign manufacturers led the Biden administration and Congress to enact policies and funding, largely enshrined in the CHIPS Act, to start bringing more semiconductor manufacturing back to the U.S.
Lockheed Martin and GF said that their collaboration will help drive semiconductor innovation and security manufacturing and they will also work to develop a chiplet ecosystem for faster and more affordable production. Chiplets are computer chips that are packaged more closely together as part of a module that goes into a computer processor.
The companies also said their work together aligns with the CHIPS Act. Leaders of the companies were joined by Senate Majority Leader Charles Schumer (D-N.Y.), a key sponsor of the legislation, who praised the partnership.
“I wrote my CHIPS & Science Act to spark partnerships like that that will secure our domestic supply chains and lead to job growth and investment in places like Upstate New York,” Schumer said in a statement.
The companies said they will “jointly pursue external funding opportunities, technology development, and collaboration with the U.S. government” to strengthen the supply chain for computer chips used in defense systems.