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Global logistics service provider Dimerco identified six supply chain pressures that are shaping the logistics involved in data centers, the critical infrastructure for artificial intelligence
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The AI boom demands the movement of a wide array of components coming from different suppliers and regions
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The six challenges are: trade compliance, freight capacity, Taiwan’s central role, insurance, controlled handling, and final-mile delivery timing
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Moving the components safely and on time spell the difference in costs and lost business opportunities
The AI boom demands the movement of a wide array of components that support data centers, which is presenting new challenges in logistics.
Global logistics service provider Dimerco, in a recent blog, identified six supply chain pressures that are shaping the logistics involved in data centers that serve as critical infrastructure for artificial intelligence.
Dimerco noted that data centers depend on graphic processing units, semiconductors, networking equipment, storage systems, cooling technology, power infrastructure, racks, security systems and other components that are sourced from different suppliers across different regions.
“This puts logistics at the center of AI infrastructure deployment. A delayed component can affect installation schedules, commissioning work, contractor availability and the date a data center becomes operational,” Dimerco said.
The challenges – linked to the different stages of the supply chain journey – also arise from the reality that transporting AI components are not the same as shipping traditional electronics given such factors as stricter multi-country trade compliance, higher shipment values, more sensitive handling, and tighter delivery timing.
The six pressure points are:
- Trade compliance – Advanced computing products can be subject to stricter trade requirements because of their technical specifications, value and potential dual-use applications. This can become harder to manage when a project includes components produced in several countries.
- Freight capacity – AI infrastructure projects can involve large volumes of high-value equipment moving within short delivery windows. Dimerco cited one project wherein the AI logistics materials involved 320 server racks moving on a tight timeline. For projects of this size, capacity planning needs to begin early to ensure air freight availability or even via sea cargo if the project schedule allows.
- Taiwan as key player – It stands as an important coordination point given its central role in semiconductor production, component supply, system integration, server manufacturing and logistics. Equipment produced in Taiwan may need to be combined with components from other parts of Asia before moving to North America, Europe or another data center market.
- Insurance – AI infrastructure shipments can carry unusually high values. For example, a fully outfitted AI server rack can approach $4 million. When several racks move together, the total value of a shipment can become very high. This can affect insurance coverage and transportation planning.
- Controlled handling – AI server racks are sensitive, expensive and difficult to replace quickly. Finished racks can also be oversized once they are prepared for transport, which can limit aircraft and truck options.
- Final-mile delivery timing – Getting equipment into the destination country is only part of the job. Final delivery often has to follow the data center’s construction and installation schedule. Shipments may need to arrive in a set sequence depending on when rooms, racks or systems are ready for installation.
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Dimerco highlighted that logistics “must be integrated into AI supply chain planning, not treated as an afterthought.”
Moving the components safely and on time spells the difference in both costs and business opportunities because even just a two-day delay on a single AI server shipment could translate to millions lost.
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