The $7 Trillion Opportunity Manufacturers May Be Underestimating

Houston pipe distributor DNOW started 2025 with zero data center customers. By year’s end, it had 11. Long steel demand tied to data center construction helped Commercial Metals post its strongest margins in three years, while Bonnell Aluminum reported a 70% year-over-year increase in shipments of T-slotted aluminum extrusions used in data centers.

The AI revolution needs a home, and manufacturers are being asked to build it. The pressure to adapt quickly has never been greater, but so is the opportunity to capture value from the federal R&D tax credit.

Activities many manufacturers already perform — improving production processes, refining product designs, implementing automation, or experimenting with new materials — may qualify. Ignoring them can mean leaving meaningful value on the table.

A leading consulting firm estimates global data center spending could reach $7 trillion by 2030. Amazon, Microsoft, Google, and Meta committed more than $350 billion to data center infrastructure in 2025, while Alphabet plans to spend $175-$185 billion through 2026.

Most people frame this as a technology story.

It is also an industrial one. Behind every data center is a physical supply chain of transformers, cooling systems, steel, fiber, and electrical infrastructure. These products are manufactured and assembled by companies already operating in America’s industrial economy.

The data center boom is not creating ordinary demand. Hyperscalers are pushing suppliers to move faster, customize more aggressively, and solve complex engineering problems.

Lead times for critical equipment now stretch 50 to 80 weeks in some categories. AI workloads require new cooling approaches, denser infrastructure, and more sophisticated power systems. Manufacturers that once competed mainly on capacity are now competing on engineering capability and speed.

That engineering work may qualify for federal tax benefits many companies have never claimed. Developing thermal-management systems, improving fabrication processes, customizing components, and investing in automation can potentially generate value when properly documented.

For manufacturers operating on tight margins while scaling quickly, recovering capital from work already being performed can create flexibility at the moment they need it most.

That may be the defining feature of this market: it rewards speed and exposes inertia quickly.

Caterpillar President Jason Kaiser, speaking at CERAWeek in Houston, said manufacturers are entering multiyear planning discussions as demand accelerates beyond earlier expectations. “We think the signals are telling us to do more,” he said, citing labor shortages and equipment availability as near-term concerns.

Manufacturers trying to win larger data center contracts are discovering that systems built for steadier demand environments are struggling under hyperscaler expectations.

The answer is not simply hiring more people or buying more equipment. It is identifying delays, manual workarounds, and slow decisions before the next wave of demand arrives.

Even manufacturers with strong demand pipelines face another problem: there are not enough specialized workers to support this level of growth.

The shortage spans engineers, electricians, technical operators, and advanced manufacturing talent. Industrial companies are now competing not just with one another, but with Amazon, Microsoft, and Google as they staff AI infrastructure projects.

The manufacturers solving this are treating recruitment as a strategic growth function tied directly to expansion capacity, not an administrative process that begins after demand arrives.

Manufacturers are also being evaluated on the resilience and security of the systems supporting their operations.

Suppliers tied to hyperscaler infrastructure often handle sensitive engineering data, supply chain information, and proprietary specifications. Enterprise-grade security and operational resilience are becoming part of the evaluation process before contracts are awarded.

The financial and regulatory environment surrounding the data center buildout is becoming harder to navigate as well.

Tariffs, sourcing restrictions, and energy policy changes are influencing how manufacturers operate and where they invest. For manufacturers scaling into data center infrastructure, these issues affect margins, expansion timelines, and long-term competitiveness.

This is where many companies encounter the same problem: advisors built to solve one issue at a time. Each brings expertise, but few connect tax, workforce, security, and regulatory strategy around growth.

alliant has worked with manufacturing companies end to end, helping them identify R&D opportunities, strengthen workforce strategies, secure operations, and navigate an increasingly complex regulatory environment through integrated solutions that go beyond a single service.

The companies benefiting most from the data center boom are not simply selling more products. They are repositioning around where industrial growth is heading.

DNOW’s shift from zero data center customers to 11 in a single year is a signal. Data centers are becoming one of the defining infrastructure buildouts of this generation. Manufacturers that recognize that early and position accordingly will likely emerge stronger than they entered it.