US industrial companies are entering the fast-growing data centre sector to tap into the surge in infrastructure spending driven by artificial intelligence. With more than $400 billion expected to be invested in 2025, companies like Honeywell, Gates Industrial, and Generac are adjusting their offerings to meet the specialised needs of hyperscale operators such as Amazon, Meta, Alphabet, and Microsoft.

Chris Snyder of Morgan Stanley noted, “We’re seeing supersonic growth on the back of AI,” highlighting that data centre clients are currently commanding higher prices than traditional industrial markets.

Cooling And Power Solutions Lead The Way

Honeywell, a $153 billion North Carolina-based conglomerate, is focusing on hybrid cooling solutions tailored for data centres. CEO Vimal Kapur stated the company is prioritising “higher-growth verticals” and has seen double-digit growth in sales of its new hybrid controller for data centre applications.

Similarly, Gates Industrial, traditionally a supplier for the trucking industry, has begun manufacturing customised pumps and pipes for liquid cooling—essential for high-performance AI chips like Nvidia’s Blackwell series.

Backup Power Sector Sees Revival

Generac, the largest US home generator producer, has been aggressively investing in data centre infrastructure to offset declines in its core residential business. Having allocated $130 million for generator scaling projects, the company now targets large-scale hyperscaler clients. “Data centres are almost isolated from economic downturns,” said Ricardo Navarro, Generac’s data centre chief.

Long-Term Outlook

With factory activity declining—reflected in sustained contraction of the ISM manufacturing index—industrial firms are betting on the relative stability and growth of the AI-led data centre sector. Analysts warn that while the market is lucrative, late entrants may struggle as capital investment eventually normalises.