Lee Sang-kyun-led HD Hyundai’s big bet: HiMSEN Engine; capacity expansion is key

[Financial News] HD Hyundai is determined to gain an early lead in the market for power-generation engines for artificial intelligence (AI) data centers. This is evident in its personnel move, which puts HD Hyundai Heavy Industries Vice Chairman Lee Sang-kyun (CEO and vice chairman overseeing the shipbuilding business) at the forefront and promotes Han Joo-seok, head of HD Hyundai Heavy Industries’ Engine and Machinery Business, to president. Its flagship product is HD Hyundai Heavy Industries’ self-developed marine power-generation engine, the HiMSEN Engine. Industry watchers say the key will be expanding production.
According to industry sources on the 15th, Vice Chairman Lee’s main responsibilities include responding to conditions in the shipbuilding market through the efficient operation of the group’s shipbuilding affiliates, as well as securing future growth engines. A prime example of a new business is the HiMSEN Engine. Its four-stroke, dual-fuel engines are marine power-generation engines with a global market share of more than 50%. Recently, as data centers have expanded, large volumes have been exported to U.S. big tech companies for land-based power generation.
HD Hyundai Heavy Industries has already signed a contract worth 1.6 trillion won to supply HiMSEN Engines for U.S. data centers. Its current production capacity of about 2.9 GW makes it difficult to meet this demand while continuing to supply existing marine engines. Current capacity is 2,940 MW, with about 300 MW of spare capacity, while the amount to be supplied for data center power generation from 2028 to 2030 is about 1,900 MW, or 580 MW a year. Capacity will be woefully inadequate if additional orders are taken into account.
Last month, HD Hyundai Heavy Industries announced that it would invest 833.6 billion won to build a new HiMSEN Engine production base. It plans to develop a 65,000-pyeong site in Onsan-eup, Ulju County, Ulsan, with an engine assembly and commissioning plant, a crankshaft machining plant, an engine block casting plant and other facilities. Construction is scheduled to begin early next year, with completion planned for May 2028. Including HD Hyundai Engine in Yeongam, South Jeolla Province, the company will secure annual production capacity of 4 GW for land-based power-generation engines. Total capacity will rise to 7.2 GW.
HD Hyundai has also completed an overseas acquisition to strengthen the competitiveness of its HiMSEN Engines for data center power generation. On the 8th, HD Hyundai Marine Solution Co., Ltd. acquired a 100% stake in Goltens, a global specialist in services for marine and land-based power-generation engines, for about 330 billion won. The company has 28 repair hubs and 31 entities worldwide, employs more than 1,300 skilled workers, and provides services to more than 2,300 clients and over 5,500 vessels.
HD Hyundai is expected to continue increasing its investment in line with future orders for data center power-generation engines. According to a Mirae Asset Securities report, data center development is increasingly shifting from a focus on mega-sized campuses to distributed facilities of 1 GW or less, and demand for power-generation engines is expected to grow over the long term. HD Hyundai Heavy Industries says that multiple HiMSEN Engines can be combined in parallel to gradually increase power supply, and that the engines are available in three systems—diesel, gas and dual-fuel—making them adaptable to a range of needs.
[email protected] Kim Yun-ho Reporter