BAE Systems taps CHIPS Act for $35m fab upgrade
BAE Systems Electronic Systems is upgrading its Microelectronics Centre and fab in the US with $35m funding from the US government.
The US Department of Commerce has signed a preliminary memorandum of terms (PMT) to fund the upgrade of the BAE Systems 4in mature-node production fab in Nashua, New Hampshire. The foundry makes MMIC microwave devices in gallium arsenide (GaAs) and 140nm gallium nitride (GaN).
The project will replace aging tools and quadruple the production of chips necessary for critical defence programmes including the F-35 fighter jet program.
The agreement with BAE Systems Inc marks the beginning of the next phase of implementation of the CHIPS and Science Act and flows the acquisition of Ball Aerospace by the UK-based company.
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“This funding will help modernize our Microelectronics Center and fulfill the promise of the CHIPS and Science Act by increasing our capacity to serve national defense programs, growing our technical workforce, and helping to strengthen the nation’s onshore supply chain. This initiative is the result of a strong partnership with federal, state, and local government.”
The PMT outlines key terms for a CHIPS incentives award, including the amount and form of the award. After the PMT is signed, the Department begins a comprehensive due diligence process on the proposed project and other information contained in the application.
After satisfactory completion of the due diligence phase, the Department may enter into final award documents with the applicant. Terms of the final award documents are subject to negotiations with the applicant and may differ from the terms of the PMT.
“We have been clear since day one that the CHIPS for America programme is about advancing our national security and strengthening domestic supply chains, all while creating good jobs supporting long-term U.S. economic growth. As national security becomes as much about the chips inside of our weapons systems as the weapons systems themselves, this first CHIPS announcement shows how central semiconductors are to our national defense,” said Secretary of Commerce Gina Raimondo.
“We have reached preliminary terms to make a substantial investment in New Hampshire’s expanding defense industrial base, which will help make our country and supply chains more secure and bolster the economy of the Granite State.”
“This announcement of the PMT with BAE Systems, Inc., demonstrates our vision for the CHIPS for America program to ensure that we have a robust production capacity for the chips vital to U.S. national security,” said Under Secretary of Commerce of Commerce for Standards and Technology Dr. Laurie E. Locascio. “This is the first of many announcements that will enhance our nation’s manufacturing capacity and create new jobs and opportunities in communities across the country.”
“Microelectronics are at the heart of the technology and products we make for our defense and aerospace customers—from next-generation aircraft and satellites to military-grade GPS and secure communications,” said Tom Arseneault, president and CEO of BAE Systems, Inc.
In February 2023, the Department released the first Notice of Funding Opportunity for commercial manufacturing facilities, and then opened it to include large supply chain projects. The Department also released a Notice of Funding Opportunity for smaller semiconductor supply chain projects and expects to launch the National Semiconductor Technology Center (NSTC) in the near future.
www.chips.gov; www.baesystems.com
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