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‘Pulling many cranes out of the market’

Semiconductor demand is bolstering American manufacturing and boosting the construction industry.


 

Projects to build the next generation of microchips in the U.S. are in full swing. Across the country, funding is being directed to construct massive new manufacturing plants that will produce the components required for smartphones, appliances, cars, military equipment, and much more.

 

Congress passed the CHIPS and Science Act in 2022, which sets aside $280 billion to invest in the semiconductor industry. Of this, $39 billion is earmarked for the construction of microelectronic factories, along with a 25% investment tax credit for the cost of manufacturing equipment. New plants are either planned or already being built in Arizona, Texas, Florida, Ohio, Pennsylvania, Indiana, and New York, with the potential for more in the future.

 

These construction projects are having a noticeable effect on the construction industry. One recently announced project with Intel, for example, estimates the creation of 30,000 new construction and factory jobs — and since that is only one project, it represents a sliver of what is anticipated to be the total of all the projects combined.

 

These investments are already driving demand for the lifting industry. According to Kevin Blaney, vice president of North America crawler crane sales at Manitowoc, there has been an immediate shift in resources to accommodate new microchip plant builds.

 

“The impact of semiconductor factory construction on the lifting industry is 100% noticeable. It is pulling many cranes out of the market and redeploying them to these projects. There are a handful of ‘megaprojects’ that require many, many cranes,” he said. “Meanwhile, the rest of the market is still strong. There is also all the other lifting work out there, too.”


Several Manitowoc crawler models, like the Manitowoc MLC300 (pictured above), are already helping build new manufacturing plants.
Several Manitowoc crawler models, like the Manitowoc MLC300 (pictured above), are already helping build new manufacturing plants.

Cranes for rent

 

In the U.S., crawler and rough-terrain cranes are seeing the most action on these projects. Microelectronic manufacturing facility job sites require a variety of cranes to complete the wide range of lifting applications underway.

 

Most of the lifting work is being funneled through construction companies that are winning project bids. They, in turn, are hiring the crane rental companies. Nearly all the work is on a rental basis, with both operated/maintained and bare rental fleets being deployed.

 

“It’s a very competitive process to win this lifting work,” Blaney explained. “It’s not just about having the lowest bid. There is an interview process and a lot of criteria considered, such as safety and performance.”


The 300-t capacity class of crawler cranes is experiencing the highest demand, followed by 600-t capacity. Several Manitowoc crawler models, like the Manitowoc MLC300 (386 USt) and MLC650 (716 USt), are already working on job sites. These cranes offer unparalleled reach and lifting capacity, and they handle the heaviest lifts on the projects.


Rough-terrain cranes play supporting roles, such as erecting crawler cranes and moving materials. Those in the 100 USt (910 t) and above classes, such as the Grove GRT8120 and Grove RT9130-2, are seeing the most action. These cranes offer excellent maneuverability, strong reach and high capacities, which give them the ability to be used in a variety of applications around the job site.


“These are real workhorse cranes that offer companies a lot of versatility,” Blaney said.


 

“It’s a very competitive process to win this lifting work. It’s not just about having the lowest bid. There is an interview process and a lot of criteria considered, such as safety and performance.” 

 

— Kevin Blaney, vice president of North America crawler crane sales at Manitowoc


 


Work for decades

 

There is a long horizon for the construction of new microchip factories, with the work set to continue for many years. The most recent projects were announced in March 2024, which means their groundbreaking is many months away. Additional projects are in the pipeline, and they aren’t just factories.


A key component of the CHIPS and Science Act is research funding. Several universities could elect to build new facilities to accommodate this work, for example. This signals that there is plenty of opportunity ahead for lifting companies to win projects tied to CHIPS and Science Act funding.



To support microchip factories, there is also an emerging opportunity for new crane operators to enter the industry. The construction project in Arizona, for example, has already faced a shortage of skilled workers, and a 2022 study found that 91% of contractors reported having trouble filling positions. In fact, the construction industry estimates that in 2024 it will need approximately 501,000 more workers than usual to meet demand.


Manitowoc contributes to the expansion of lifting education — the Heavy Equipment Colleges of America chooses Manitowoc cranes to educate the next generation of crane operators. 79% of its students are millennials or younger. With so much work ahead for lifters, it’s a great time for experienced and new operators alike.


“I was just talking to folks in the industry that think this could be a 20-year run of work,” Blaney said. “There is a chain reaction of new construction work boosting lifting work. Manitowoc and its customers must keep communicating as trusted partners to ensure the supply chain of cranes to the market stays robust.”

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