On February 7, Openai CEO Sam Altman issued a call on X for more AI infrastructure in the world than people are currently planning to build. A day later, the Wall Street Journal reported that Altman was in discussions with potential investors, seeking as much as USD 5 to 7 trillion to boost chip production to a level that would further accelerate the growth of his company and the overall AI sector.
A lot of attention since then has (unsurprisingly) been on the headline investment figure, which – to put it in shipping industry terms – would represent around five times the estimated value of the global merchant vessel fleet today.
The “great games” of the 21st century
We are living in an era of intense geopolitical competition, with the U.S., China and the E.U., in particular, jostling for position and advantage as the three “centers of gravity” of global trade. Electric vehicles and batteries; solar power and green energy; semiconductors; in these and other strategic sectors, we are seeing national governments legislate and allocate investment to try to protect their domestic workers and industries while transitioning to the areas that will guarantee economic growth in the future. We are also already seeing shifts in semiconductor production as part of a nearshoring trend. Altman’s call for investment in chip production will resonate with a U.S. government that is acutely aware of the capabilities that its rivals are building up at pace and concerned about falling behind, as well as future risks to national security. But the fundamental laws of economics and competitive advantage indicate that trade will continue to flow from markets with lower labor and production costs, albeit at varying levels. As the world swings between the interdependency of global supply chains and spikes in domestic production and protectionism, logistics companies will need to provide the flexibility, visibility on material flows and expertise on capacity management and network design that their customers need to respond in real time.
Resilience
Altman argued in his X post that massive-scale AI infrastructure and a resilient supply chain are crucial to economic competitiveness. Since the disruption that the pandemic unleashed on global supply chains, our industry has become a more regular feature on corporate board room agendas, and resilience has become arguably the No. 1 priority in those discussions. Resilience in the supply chain can come in many forms – adding redundancy, planning contingency routings and capacity, redesigning networks to be closer to customers or production sites, shifting between modes of transport, maintaining higher stock levels, diversifying supply sources, or simply increasing real-time visibility. Logistics companies are best positioned to identify the approaches that achieve resilience with an optimal balance of cost, service reliability and quality. As with any journey into uncharted waters, any attempt to supercharge chip production will undoubtedly encounter bumps and knocks, challenging everyone on the ship to pull together and respond. True supply chain resilience for a project of this scale will require the type of adaptable and flexible approach that our industry has perfected over the last 4-5 years, supported by the very technologies that it is working to advance.
The sustainability paradox
To achieve the Paris climate targets and our own net-zero ambitions, the logistics industry, like many others, needs to see further step changes in technology. AI will play a decisive role in this, helping us discover new green solutions and materials that reduce or eliminate emissions, as well as to generate insights that accelerate the development of EVs, sustainable fuels, and other nascent clean technologies. One of the major criticisms leveled against Altman’s plan has been that the energy and other resources needed to support such a gargantuan level of chip production and processing power for AI will be damaging for the environment. In the shorter term, the supply chain – through its efficiency and optimization measures – offers one of the most effective levers to mitigate the environmental footprint of this kind of AI infrastructure expansion. In the longer term, paradoxically, a truly zero-emissions supply chain will be dependent on the kind of breakthrough that only an expansion like this can provide.
Whether or not the final investment figure that is required to realize Altman’s ambitious vision is as much as USD 7 trillion (he even discussed revising it up to USD 8 trillion in a playful post later in the month), it is clear that the logistics and supply chain sector would play a critical role in making it a success. We are already seeing the potential of AI to transform our industry. By the same virtue, logistics can play an essential role in any large-scale, transformational effort to expand AI.
