March 6, 2017

Global Foundries makes solid use of IBM campus

The front entrance of the Global Foundries facility in Essex Junction. Provided photo

The front entrance of the Global Foundries facility in Essex Junction. Provided photo

By Bruce Edwards

Correspondent

ESSEX JUNCTION — Nearly two years after acquiring the IBM plant, Global Foundries is ramping up employment at its Essex Junction microelectronics facility, adding another 200 workers to keep up with demand for its silicon wafers.

“For what we’re doing in (the) Burlington (area), we’re working at full capacity,” said Jim Keller, senior communications manager.

The former IBM plant manufactures 200-millimeter radio frequency chips used in cellphones and other mobile devices.

“You’d be hard pressed to find a phone that doesn’t have a chip that was made in Burlington,” Keller said.

The 725-acre campus houses 3.5 million square feet of manufacturing, laboratory and office space.

Keller said the company has openings for manufacturing and production jobs, engineers and technicians.

The plant also has openings for student interns that could turn into permanent jobs, he added.

Pay range varies depending on the job and experience. Keller said some jobs require a two-year degree, while others require a bachelor’s degree

The new hires will raise employment at the plant to 3,000, a far cry from IBM’s busiest days, when the plant had as many as 8,500 workers.

Keller said the business model has changed since IBM’s heyday, when the company made its own computers.

“IBM was mainly in the chip business for its own chips,” he said. “While the company was using chips that came out of each of its facilities for all of its computers there was a need to probably have a larger staff.”

Although it has fewer employees than at its peak under IBM, the microelectronics plant remains a large cog in the Vermont economy.

When news surfaced that IBM would indeed unload its plants in Essex Junction and East Fishkill, officials expressed some concern about the plant’s future.

But Frank Cioffi, president of the Greater Burlington Industrial Corp., said those concerns have been put to rest thanks in large part to a smooth transition under Janette Bombardier, the plant’s senior location executive. It’s a similar role to the one she had overseeing the two plants under IBM.

Cioffi was unabashed in his praise for Bombardier.

“She is absolutely phenomenally brilliant, and probably the best site manager that I’ve come to know in the 20-plus years I’ve been working with the company,” he said.

He credited Bombardier with keeping the plant competitive in such areas as energy efficiency and making environmental improvements.

“Right now, today, their production is as much as it’s ever been or more, and she’s been knocking their energy bills down by about 4 percent a year through operational efficiencies, equipment,” Cioffi said.

He said the evidence points to a strong commitment to the state, with Global Foundries already having invested tens of millions of dollars in the plant since acquiring the business.

Keller agreed, saying the Vermont facility — known as Fab 9 — is “a good, solid business location for us, and we see it remaining that way for a while.”

Cioffi also pointed out that IBM still has a research-and-development presence at the site with roughly 400 workers.

Under IBM, the state estimated that at one point the plant contributed $1 billion a year to the state’s economy. Cioffi said that remains pretty close to the mark today.

If there is any difference, the plant is generating “significantly” less in corporate tax revenue for the state. He said IBM over the years began shifting more of its focus to servicing its customers, which generated more income than chip production. Global Foundries, on the other hand, is focused solely on technology development and manufacturing, a very capital-intensive business with very thin profit margins, Cioffi said.

The sprawling campus is also a major tax contributor to Essex Junction. In fiscal 2016, the Global Foundries property tax bill accounted for 9.6 percent of village property taxes, which is on a par with IBM. The plant is also a major water user, accounting for 75.2 percent of the village’s water revenue in fiscal 2016.

Global Foundries has six plants worldwide, with each plant tasked with different work.

The company acquired IBM’s Vermont and East Fishkill, New York, facilities in July 2015. However, this was no routine transaction. IBM paid Global Foundries $1.5 billion to take the plants off its hands.

The East Fishkill plant (Fab 10) has 1,700 employees; the Global Foundries plant (Fab 8) in Malta, New York, near Albany, has 3,000 employees.

The company also has manufacturing plants in Germany, Singapore and a new facility in China. Worldwide, the company has 18,000 employees spread across 14 locations.

Based in Santa Clara, California, Global Foundries is owned by the government of Abu Dhabi, the capital of the United Arab Emirates.

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