The Eyepopping Factory Construction Boom in the US. (wolfstreet.com) [View all]

The Eyepopping Factory Construction Boom in the US
by Wolf Richter • Dec 2, 2023

https://wolfstreet.com/2023/12/02/the-eyepopping-factory-construction-boom-in-the-us/

In October, $18.5 billion were plowed into construction of manufacturing plants in the US ($246 billion annualized), up by 73% from a year ago, by 136% from two years ago, and by 166% from October 2019. The relentless pace of the month-to-month increases is what’s amazing – from $12.5 billion spent in January to $18.5 billion in October.

The construction boom started in early to mid-2021, and since then, spending has tripled. About a year later, in July 2022, Congress passed a package of subsidies for select manufacturing industries to build factories, such as semiconductor makers (they’ll get $52 billion) and EV battery makers.

But the wheels of government turn slowly, approvals take their time, disbursements of funds for large projects takes time, so the flow of these government funds would just be the first trickle in 2023. The bulk is still coming.

For the calendar year 2023, spending on factory construction will likely get close to $200 billion. For the first 10 months, the ever-larger monthly amounts already reached $159 billion. If November and December are only flat with October, spending will reach $196 billion by year-end.

More at the link.

Some comments on Hacker News:

• People are finally realizing sending all your manufacturing to countries that hate your guts is a horrible idea? There may be hope for us yet!

• Only took 40 years….

•Right, inflation reduction act and China decoupling in general. Tangentially, Mexico is now the US' top trading partner, with China in 3rd place.

• What we should have done 40 years ago. Bootstrapping Mexico/LA over Asia fixes a lot of problems