Case Study: Steel Shortages Cause Delay in Chicago Rail Overpass Project (2021)
Project Overview
• Name: Chicago South Side Rail Overpass
• Location: Chicago, Illinois
• Year: 2021
• Project Size: $290 million
• Scope: Construction of a new rail overpass including large structural steel fabrication
• Lead Agencies/Contractors: Illinois DOT /
Category of the Issue, Problem, or Challenge
• Supply Chain Disruption
• Structural Materials Procurement
Summary of the Issue, Problem, or Challenge
Steel supply shortages linked to national production bottlenecks caused major delays in steel delivery and fabrication. Tariff uncertainties and raw material price spikes further complicated procurement.
Root Cause Analysis
- Limited domestic steel mill capacity and production backlogs.
- Tariff and trade policy uncertainties delaying procurement decisions.
- No alternative steel suppliers identified early.
- Project schedules based on optimistic delivery assumptions.
Impacts Due to the Issue, Problem, or Challenge
• 5-month delay in structural steel erection phases.
• Cost overruns from price escalation and rush orders (~$6.7 million).
• Impact on connected roadway and utility relocations.
Corrective Actions Taken
- Identified secondary steel suppliers and negotiated priority allocations.
- Adjusted schedule with phased steel delivery and erection.
- Implemented real-time market monitoring for price and supply changes.
Lessons Learned
- Heavy civil projects must closely monitor steel markets and tariff impacts.
- Early supplier diversification and flexible scheduling mitigate supply risks.
- Contract clauses should address supply uncertainty.
Audit & Prevention: Project Control Questions to Ask on Future Projects to Help Control the Situation
- Are steel suppliers and capacity fully vetted?
- Is there a plan to handle price volatility and delivery delays?
- Are contract terms aligned with supply chain risk management?