It was only a staged turning of dirt, but the groundbreaking ceremony today for the GlobalFoundries computer chip factory marks a high-tech economic transformation that will impact the whole region, speakers said.
“This project will fuel long-term growth in the Capital District and cement our state’s reputation as a world leader in New Economy innovation,” said Gov. David Paterson — who readily conceded he had initially been skeptical when first approached four years ago about the state’s making an investment to bring the project to New York, which he put at $1.37 billion.
“I said this was one of the poorest investments we could make, it would be wasteful, it would not create jobs,” he recalled.
But many hours of conversation with former governor George Pataki and former Senate majority leader Joe Bruno changed his mind, he said.
“Whatever investment we make will be repaid over and over,” Paterson said Friday.
Paterson, U.S. Sen. Charles Schumer and other leaders were on hand to celebrate the start of construction on the $4.2 billion Fab 2 computer chip plant, to be built at the Luther Forest Technology Campus.
More than 50 acres of forest have been cleared in the last five weeks, and actual building construction won’t start until September. Earth-moving equipment continued to work a few hundred yards away as the ceremony was held before an invited audience of more than 300.
“This is an exciting day for us. (This plant) represents a model for partnership of public and private sectors for technology and innovation,” said Hector Ruiz, GlobalFoundries’ chairman, who served as master of ceremonies.
The 1.3 million-square-foot factory is expected to take about a year to build. There will then be another year in which the sensitive and expensive computer-chip manufacturing equipment is installed, and another year of testing and ramp-up before full production starts in 2012.
The plant will have about 1,465 permanent employees, and in the meantime the construction project will employ up to 2,000 people.
“This will be the world’s most advanced semiconductor manufacturing facility,” Ruiz said.
GlobalFoundries is the company that was formed in March by Advanced Micro Devices and Abu Dhabi investors, to take over the AMD manufacturing operations that were responsible for much of AMD’s multibillion dollar losses in the last two years.
GlobalFoundries is operating former AMD chip plants in Dresden, Germany, and the pending plant as “foundries,” or plants that make computer chips to order for any customer.
To date, AMD is GlobalFoundries’ only customer, but company officials have recently said it will soon announce a second customer. “I look forward to hearing about new customers joining the family soon,” said Dirk Meyer, AMD’s CEO.
Having multiple customers is generally the key to economic viability of foundry plants, most of which are currently located in Asia. This will be the first U.S. foundry.
“Stay tuned next week,” GlobalFoundries CEO Doug Grose said when asked about prospects for another customer after the ceremony.
On stage, Schumer used visual props — a bag of convenience store potato chips, and a 12-inch computer wafer.
“For 150 years, Saratoga was known for chips,” Schumer said. “The potato chip was invented here. Now it will be known for another kind of chip.”
Officials who first pitched the Capital Region and its economic and educational resources to the computer industry years ago were also on hand.
“This isn’t just another groundbreaking. It is the largest investment made in this state in a manufacturing facility, but an order of magnitude. It is one of the largest investments ever in a manufacturing facility in the United States,” said Pataki, who with Bruno negotiated the state incentive deal with AMD in 2006.
Bruno, who resigned from the state Senate last year admit an FBI probe of his business dealings, sat in the front row, but did not speak.
Backers have said up to 5,000 more jobs may be created in the industries that typically supply and support a large computer chip plant — and some of those companies are already showing interest, officials said.
The Saratoga Economic Development Corp. on Thursday night hosted an event in Saratoga Springs that a number of prospective industry suppliers attended.
“Our thing was to tell them when they’re ready, we have resources,” said Dennis Brobston, the SEDC president. “If we don’t have a site in Saratoga County, these companies will definitely land somewhere in the region. We’re very optimistic we can get these things moving quickly.”
Malta Supervisor Paul Sausville, who received two checks totalling $1.1 million on Friday as part of a community benefit agreement with GlobalFoundries, said he wasn’t surprised the plans are coming to fruition.
While the plans have had many skeptics over the years, Sausville noted the two towns have worked closely with AMD and GlobalFoundries on a variety of zoning and planning issues.
“We’ve known all along they wouldn’t put this kind of energy into it if they weren’t committed,” Sausville said.
Paterson, speaking to reporters after the ceremony, acknowledged there are still people who believe the project will fail or the plant not be built.
“Right now, this is an immense opportunity, and you’re not going to move forward without a certain amount of risk,” Paterson said. “I do think this is a wise investment. I think years from now people who were opposed to this will not remember it.”
GlobalFoundries has bought 223 acres, enough land for up to three computer chip plants to be built over the next 25 years.
Construction equipment continued to work throughout the time the groundbreaking was taking place at a huge tent erected on the periphery of the property.
Brian Parlman, general supervisor for project construction manager M+W Zander, said the clearing and leveling of the land in preparation for actual construction is still underway.
“In about another month, you’ll see this site absolutely flat,” he said, gesturing to the ridges where earth movers worked. “Foundations will be poured around the first week in September.”
Reach Gazette reporter Stephen Williams at 885-6705 or [email protected]
GlobalFoundries is operating former AMD plants in Dresden, Germany and the pending plant as “foundries,” or plants that make chips to order for any customer.
To date, AMD is GlobalFoundries’ only customer, but officials have said it will soon announce a second customer.
“Stay tuned next week,” GlobalFoundries CEO Doug Grose said when asked about that prospect after the ceremony.