Manufacturing investment in the United States has surged, fueled by artificial intelligence, data centers, semiconductors, defense, and infrastructure development. According to economic speakers at the American Foundry Society Leadership Summit, $2–3 trillion in manufacturing investments are in the pipeline. Yet, manufacturing capacity hasn’t kept pace across most industries.

An October 2026 Federal Reserve Bank of Kansas City report reinforces this disconnect. Inflation-adjusted spending on new manufacturing plants averaged approximately 70% higher during 2022–2025 than during 2015–2019. However, capacity expansion has been concentrated in computers, communications equipment, and semiconductors, which account for only about 3% of U.S. manufacturing output. Capacity across the rest of manufacturing remains below pre-pandemic levels, reinforcing observations from AFS speakers about investment concentrated in strategic industries tied to national security and electronics.

This imbalance creates significant opportunities. As investments accelerate, demand for equipment, materials, components, and supporting infrastructure will grow. Yet manufacturers constrained by capacity, suppliers, talent, or outdated planning processes may struggle to capitalize, while those with available capacity and operational flexibility could capture substantial growth. The opportunities are potentially once-in-a-lifetime. Are you positioning your company to take advantage?

Capitalizing on the Next Wave of Manufacturing Growth

Data center expansion is driving demand for electrical equipment, cooling systems, fabricated metal products, and supporting components. Opportunities even extend into aerospace engine capabilities. Similarly, aerospace, defense, and infrastructure investments are creating opportunities across multiple industries and supply chain ecosystems. The key is to think in terms of capabilities, not simply existing products.

However, you cannot wait for opportunities to come to you. According to our recent Supply Chain Byte, 44% of smaller manufacturers (under $50 million in revenue) utilize less than 70% of their capacity, compared with only 16% of larger manufacturers (over $100 million). Yet having available capacity doesn’t guarantee new business. Potential customers are unlikely to find you among thousands of suppliers, even when searching for additional manufacturing capacity.

Anticipate where demand is headed, evaluate emerging markets against their capabilities, and proactively pursue the most promising opportunities. Predictive demand planning SIOP (Sales Inventory Operations Planning) can help identify shifts in demand and evaluate alternatives. In many cases, manufacturers can leverage existing equipment, workforce expertise, and supplier relationships to pursue adjacent markets without significant capital investments. Others may need to innovate, develop new products, strengthen partnerships, or invest in targeted capabilities.

The manufacturers that identify opportunities early and adapt their capabilities to meet emerging needs will be positioned to capture growth ahead of their competitors.

Case Study: Industrial Manufacturer Positions Itself for Growth

A manufacturer of storage and racking solutions for distribution, retail and warehosues struggled to keep up with demand during the pandemic as e-commerce surged and companies purchased whatever inventory they could get their hands on. Thus, the need for warehousing expanded. To meet these needs, the company increased output within their same footprint by rolling out advanced technologies such as robotics, improved production planning and scheduling systems and capabilities, and tied these initiatves with an increased emphasis on labor efficiency and operational flow.

However, as e-commerce growth moderated and warehouse expansion projects slowed, customers began putting orders on hold. Rather than waiting for demand to return, the manufacturer looked ahead to identify new opportunities. With data center investment accelerating, the company tailored products, services and relationships to support this rapidly expanding market. Instead of relying solely on its traditional warehouse customers, it positioned itself to serve an emerging industry with significant growth potential.

Just as importantly, the company had strengthened its operational capabilities. Improvements to its Sales Inventory Operations Planning (SIOP) process, production planning, and scheduling processes and CRM, CPQ, ERP and BI systems enabled the leadership team to proactively evaluate its manufacturing network, reallocate production, and identify opportunities to better utilize capacity, maximize margins, and leverage key opportunities as they arose. With greater visibility into demand and capacity across its operations, the company could evaluate how new opportunities would affect production requirements, determine where to allocate resources, expand facilities, purchase equipment, and balance customer needs with profitability. These capabilities helped the manufacturer pursue new markets while making better use of its existing resources.

By combining product innovation, market diversification, and stronger planning capabilities, the company positioned itself to turn changing market conditions into opportunities for profitable growth.

Prepare to Capture Profitable Growth

Manufacturers must get proactive and prepare by asking themselves key quetions.

  • Where are investments accelerating, and what new products or capabilities will be required to take advantage of potential opportunities?
  • Can existing manufacturing expertise be leveraged to serve adjacent markets?
  • Are there opportunities to strengthen customer relationships, develop new products, or expand into growing industries?

Equally important, companies must ensure their operations and supply chains can support these opportunities profitably. AI-enabled SIOP, capacity planning, and production scheduling provide the visibility to evaluate demand scenarios, anticipate bottlenecks, optimize manufacturing networks, and align resources with market opportunities.

The objective isn’t simply to increase volume. It’s to identify the right opportunities, maximize margins, improve capacity utilization, and position the business for sustainable, profitable growth.

The manufacturers that pull ahead will be those that anticipate market shifts, proactively position their products and capabilities, and build the operational flexibility to capitalize on the next wave of growth.

History has shown that periods of significant disruption can create extraordinary opportunities. In fact, more companies rose to the top of their industries during the Great Depression and maintained their leadership positions than during any other period in history. The opportunities ahead could be equally significant, if not greater. Are you prepared?

If you are interested in reading more on this topic:
The New Playbook for U.S. Manufacturing Growth