Carrier expects data-center equipment sales to reach about $2 billion this year
Carrier Global plans to invest more than $600 million in a new Fort Worth, Texas, plant that will make cooling equipment for data centers and other large commercial and industrial buildings. The Fort Worth project is the company’s biggest-ever investment and is expected to more than double its production capacity for commercial chillers. In the report-time market quote included in The Wall Street Journal’s coverage, Carrier Global shares were up 0.53%.
Carrier expects equipment sales to data centers to reach about $2 billion this year, putting the company on course to double its data-center sales for a second straight year. The investment comes amid record order volumes for Carrier’s chillers used in data centers.
“We have significant demand over the next two years,” said Carrier Chief Executive Dave Gitlin. “The biggest challenge we have is just ensuring that we can keep up with that demand. We cannot keep up without building this additional facility.”
Data centers need robust cooling systems because their computer servers contain power-hungry chips that generate heat as they operate artificial-intelligence programs. AI data centers often contain thousands of tightly arranged servers that require continuous cooling to operate reliably and avoid overheating.
“Anywhere you have a lot of power, it generates heat,” said Tom Mertz, CEO of EverOn, an Atlanta-based data center construction contractor. “As data centers have grown, the heat complexities have grown as well, and so has everything around cooling in the data center.”
The Fort Worth plant is expected to exceed one million square feet. Carrier said it would add more than twice the commercial-chiller production capacity currently offered by the company’s plants in North Carolina and Mexico. The company also envisions manufacturing chiller components, including compressors, at the facility.
Gitlin said the new plant will be able to produce 3,000 commercial air-cooled chiller units annually, enough to cool a million residential homes. A single data center can require hundreds of chillers.
Carrier’s sales of large commercial HVAC equipment have been growing by about 25% a year recently. Besides data centers, the company has seen an uptick in sales to hospitals, semiconductor plants and schools.
About 70% of sales from Carrier’s Climate Solutions Americas business have traditionally come from residential and small commercial HVAC equipment, with large commercial accounting for the remaining 30%. Carrier expects the commercial share of those sales to be close to 40% this year, and Gitlin expects commercial sales eventually to eclipse residential sales.
Carrier expects the Fort Worth plant to advance its growth in the large commercial HVAC market, making the company more competitive against Trane Technologies and Johnson Controls’ York brand.
Gitlin said Carrier evaluated several sites in Texas and Alabama before settling on Fort Worth. He said the Dallas-Fort Worth area is close to many of the company’s large commercial customers and has a deep reservoir of construction workers and skilled technicians needed to operate the plant once it is complete. The facility is being built in a 27,000-acre industrial and commercial development in north Fort Worth known as AllianceTexas.
The shell of the new Carrier plant is expected to be completed in a few months, and the company wants to have three or four lines of chillers operating by late next summer. Carrier said the plant will provide 1,500 manufacturing and engineering jobs.