[INFRASTRUCTURE] Improve API availability / reduce 529 Overloaded errors

Preflight Checklist

• [x] I have searched existing requests and this feature hasn't been requested yet
• [x] This is a single feature request (not multiple features)

Problem Statement

During active development sessions with Claude Code CLI (and Web Claude),
529 Overloaded errors frequently interrupt the workflow. This is not an
isolated case — based on community discussions, many developers experience
this issue, especially during peak usage hours.

This is particularly disruptive during long agentic coding sessions where
context continuity matters — a failed request breaks the flow and requires
re-establishing context. The problem likely affects a significant portion
of Claude Code users globally, not just specific regions, though developers
outside the US (e.g., EU) may experience it more due to geographic distance
from API infrastructure.

Proposed Solution

• Implement automatic retry with exponential backoff in Claude Code CLI

when a 529 error is received, instead of immediately failing

• Add a configurable retry policy (e.g., max retries, backoff interval)

so developers can tune it for their workflow

• Consider regional API load balancing or edge routing to distribute

traffic more evenly and reduce overload spikes

Alternative Solutions

Currently I work around this by waiting manually and retrying the
request, or switching to the web interface (claude.ai). This breaks
the development flow, especially during long agentic sessions where
context continuity is critical. There is no built-in way to handle
529 errors gracefully in Claude Code CLI.

Priority

High - Significant impact on productivity

Feature Category

API and model interactions

Use Case Example

Example scenario:

1. I'm working on a full-stack project (NestJS + React) with a well-configured

CLAUDE.md that defines project structure, conventions, and task context

1. During a long agentic session, I ask Claude to refactor a service

and update related tests across multiple files

1. Mid-session, a 529 Overloaded error occurs — the request fails

and the conversation context is lost

1. Even though CLAUDE.md helps restore project-level context, the

session-specific reasoning and multi-step plan are gone — I have to
re-explain the task and re-establish the chain of thought

1. With automatic retry/backoff, the CLI would transparently handle

the 529 and continue the session without interruption, preserving
both the CLAUDE.md context and the in-flight reasoning

Additional Context

• Environment: macOS (Apple Silicon M4 Max), Claude Code CLI latest version
• Region: EU (Estonia) — may be relevant for latency/routing to API servers
• The 529 errors occur irregularly but frequently enough to disrupt

daily development workflow

• Similar retry/backoff patterns are standard in other CLI tools

(e.g., AWS CLI, gcloud CLI, GitHub CLI all handle transient
server errors with automatic retries)