North America dominates global industrial construction project pipeline, finds GlobalData

GlobalData’s latest report, ‘Project Insight - Industrial – 1Q23’, reveals that the US dominates the project pipeline in North America, representing 84.9% of the pipeline, with the total value of projects amounting to US$876.2 billion.

Jack Riddleston, Construction Analyst at GlobalData, comments: “In terms of pipeline value, North America has accelerated away from North-East Asia, which holds the second-largest industrial project pipeline. Major project announcements in 4Q22, such as the US$12 billion Phoenix Chip Manufacturing Plant in Arizona, US, and the US$10.6 billion Mazda Electric Vehicle Production Facility in the US, have largely driven the sizable increase in the North American pipeline. Whereas, in North-East Asia, the pipeline has marginally contracted 0.9% from the previous quarter, with the total pipeline value equating to US$907.4 billion or 19.1% of the global project pipeline.”

Based on GlobalData’s analysis of the industrial construction projects currently in the pipeline in North America, construction spending will reach US$194.8 billion in 2023, if all projects go ahead as planned and spending is evenly distributed over the construction stage.

GlobalData is currently tracking industrial construction projects in North America with a total value of US$1.03 trillion. Projects in the pre-execution and execution stages account for 37.6% of projects in the pipeline, whereas in North-East Asia this figure is 44.8%, indicating a higher percentage of projects are in the early stages of development in North America.

 

Riddleston continues: “A spur in growth in the US project pipeline is largely due to “re-shoring” and increased dynamism to move technology supply chains away from Asia and China in particular. Trade disputes with China and Net Zero targets have galvanised the Biden administration to ramp up investment into green technology such as electric vehicle manufacturing and advanced technology production."

In mid-2022, the US government passed two major stimulus packages; the CHIPS and Science Act (which will put around US$80 billion in Semi-conductor Manufacturing), and the Inflation Reduction Act (which will put US$369 billion into Energy and Security and Climate change initiatives over the next 10 years, including EV manufacturing subsidies and many others).

 

As a result of new funding for new projects being given the green light; the US semiconductor manufacturer SkyWater Technology announced plans in mid-2022 to build a US$1.8bn semiconductor R&D and production facility in Indiana, in partnership with the state and Purdue University and construction expected to commence in 3Q24.

Riddleston concludes: “Furthermore, major projects such as the US$5.5 billion Savannah Electric Vehicle and Battery Manufacturing Facility in Georgia, US and the US$5.0 billion Sherman 300 MM Wafer Manufacturing Plant in Texas, US broke ground over the past quarter as construction activity commenced on each project.”

Read the article online at: https://www.worldcement.com/the-americas/01032023/north-america-dominates-global-industrial-construction-project-pipeline-finds-globaldata/