Planning Across Borders: AI Transforms The Global Construction Supply Chain 

In the face of shifting U.S. tariffs, global conflicts and supply chain disruptions, project managers want to decrease their procurement risk with real-time supplier data 

By Eshan Jayamanne, Founder and CEO of Krane (https://www.krane.tech/en)

The U.S. construction industry is experiencing significant supply chain disruptions as vulnerabilities in the system have been exposed by tariffs and covid shocks increasing average material lead times to 79 days, according to Deloitte’s 2025 Manufacturing Outlook.

Commercial construction related shipments and pricing for goods to U.S. builders have become unpredictable, extending material lead times that increase project risk. The trend is primarily due to tariffs, Covid shocks and various global conflicts, such as wars in the Middle East, Africa and Eastern Europe. These factors are impacting material costs while also delaying projects for weeks or months.

A large commercial construction project can include as many as 10,000 different line items associated with the construction of a hospital, a data center or an office building. For contractors, understanding lead times and pricing of the most common materials in addition to factoring in the logistics of transporting them to job sites in 2025 has become increasingly difficult.

The real need for the building industry is increased transparency of data shared between GCs and their trade partners, providing more accurate views into supply inventory levels and pricing while eliminating the unforeseen surprises that delay projects.  Transparent data builds trust by ensuring all stakeholders have the most relevant and actionable data throughout the construction process, enabling them to make informed decisions with confidence.

Real-time data helps contractors make informed decisions about material sourcing as lead times and availability for materials like steel rebar and electrical switchgear are in flux, being delayed as many as 60 days. Improved visibility enables proactive inventory management and strategic purchasing before further price spikes occur.

Beyond domestic borders, builders are adopting global sourcing to enhance supply chain resilience and cost-effectiveness. Deloitte cites that 97% of companies surveyed in the Economist Impact’s ‘Trade in Transition for 2024’ project stated they were reconfiguring their supply chains in some way.

GC’s who extend their supply chains globally benefit from negotiating with independent suppliers or leveraging more dynamic marketplaces to obtain competitive pricing, meet purchasing compliance and sustainability goals, while boosting supply chain resiliency.

Earlier this year, nearly 25% of commercial contractors reported tariff-related project delays or cancellations – prompting builders to re-evaluate their procurement strategies as costs continue to rise.

Although supply chain resiliency has been an important area of focus over the past two years, we also see commercial construction companies shifting their priorities back to driving efficiencies. As a result, this year, construction firms are de-risking their supply chains and driving efficiencies across procurement.  This is accomplished through diversifying supplier relationships and adopting predictive analytics tools to more accurately forecast equipment and material needs while minimizing the risk of delays and shortages.

Persistent supply chain vulnerabilities spell out the need for digital tools, ones connecting valuable data concerning price points and leveraging AI capabilities. This helps builders get the visibility – through better data – to manage material flow from the back office and cloud directly to project managers at the job site.

U.S. Tariff Impact: A Cascade of Rising Costs
A direct challenge for contractors comes from recently implemented tariffs, which are increasing project bids. A recent 50% tariff on steel and a 10% levy on electrical components are contributing to cost increases throughout the construction supply chain. Steel saw the sharpest climb, with iron/steel and steel mill product prices increasing by more than 5% in just one month.

Fabrication lead times for structural steel now stretch to nine weeks, while steel rebar prices surged 26% since last year, adding financial pressure to budgets. The volatility in material pricing complicates long-term project planning and budget adherence, suggesting a need for agile, data-driven approaches to procurement.

As a result of increased costs from tariffs, commercial construction projects are being delayed during the planning phase, with nonresidential projects taking 6.5 months longer today than in 2019, while warehouse lead times can be extended from one day to the next, delaying projects.

Global Disruptions Compound Domestic Challenges
International political tensions throughout Europe and the Middle East have been slowing global transit timelines, creating a complex situation when combined with domestic trade policies. These geopolitical factors require contractors to build larger buffers into their schedules, extending project timelines by months. Traditional construction management approaches, which rely on manual processes, such as excel sheets with line items for each purchase, or software systems operating in a single silo across one company’s network of suppliers have proven insufficient for a very new reality. Supply chain data often remains fragmented across vendors and third-party logistics providers, limiting onsite teams’ visibility for effective planning.

AI-Driven Data Meets Construction Pros Where They Are
More commercial contractors are utilizing artificial intelligence (AI) and advanced analytics to improve control over their supply chains and mitigate risk. AI directly addresses key performance metrics, shortening job times and saving money. Importantly, data needs to be at the fingertips of construction project managers who start their day needing information about materials in real time, letting them know what materials are set to arrive or if there are problems. Common tasks include submittal tracking and updating of inspection reports.  

Builders implementing AI in their workflows report average productivity gains of 20- 30% and reduced project timelines by 15–20%, according to Construction Leadership Network’s industry report.

Performance metrics that are driven by supply chain software and AI include:

• Delivery Accuracy: Use of real time data to achieve a high delivery accuracy rate, with real-time indexed updates helps ensure materials arrive on time and at the correct location.
• Reduced Jobsite Downtime: Lead time-driven scheduling and predictive insights helps construction planners to minimize delays on the project site.
• Reduced Coordination Time: AI automation, or “bots,” have purpose-built construction industry capabilities that streamline workflows and cut down on the time spent coordinating tasks and communicating updates.
• Overall Project Efficiency: AI and software tools are pointed at material delays, waste, and supply chain disruptions by measuring the current status of each material, letting project managers know that a critical delivery will be made on time, through real-time tracking and insights.

Driving Bottom Line Impact
The challenges facing construction companies extend beyond cost increases or future tariffs and inflation. The industry is evolving from reactive procurement approaches toward predictive planning frameworks that forecast potential disruptions and enable rapid strategic adjustments. Builders must decrease risks for their projects and can leverage advanced AI to shift from tracking from behind to anticipating ahead of delays. Contractors should evaluate procurement and supply chain management to acquire systems with real-time visibility, broad supplier intelligence, and predictive analytics. Once integrated into the business, AI-driven tools enable informed procurement decisions before delays impact critical paths.

Conclusion:
Transparency, trust, and predictable outcomes drive successful outcomes in the commercial construction industry.

As tariffs, inflation and geopolitical tensions persist, companies will face a choice: either continue with traditional procurement methods and accept increasing delays and high costs or invest in new AI technologies and processes that offer greater supply chain visibility and control. Because construction relies on precise timing and tight margins, the message is clear: materials procurement and visibility must adapt to the realities of modern construction.

To learn more, please visit https://www.krane.tech/en