Gunsan New Plant and New Power-Generation Engine: HD Construction Equipment Targets 2.5 Trillion Won in Engine Sales

[Financial News] HD Construction Equipment is stepping up its push into the market for power-generation engines for artificial intelligence (AI) data centers. It is bringing its new Gunsan engine plant online and unveiling a new ultra-large power-generation engine. The company aims to generate 2.5 trillion won in revenue from its engine business alone by 2030.
According to HD Construction Equipment on the 28th, it has brought online a new engine plant in Gunsan, built with an investment of 116.8 billion won on a site measuring 19,000 pyeong. The plant can produce 1,250 ultra-large power-generation engines in the 1-to-3-MW range annually. Its capacity has been greatly expanded in response to the worldwide growth in data centers.
Orders have been increasing, including a recent agreement to supply long blocks—the engine bodies—for 22-liter gas power-generation engines for data centers to Irok, a U.S. power infrastructure solutions company, in a deal worth 387.9 billion won. The Gunsan plant is scheduled to begin mass production of 37-liter, 1.3-MW engines in the first half of next year; 77-liter, 3-MW engines in 2028; and 50-liter, 2-MW ultra-large power-generation engines in 2029. The 37-liter DX37 power-generation engine was unveiled at the Gunsan plant’s opening ceremony that day, while a start-up ceremony for the 77-liter ultra-large DX77 model was held at the plant on the 15th.
In addition to power-generation engines, the Gunsan plant has annual production capacity for 120 tank engines for the defense industry and battery packs totaling up to 1,460 MWh.
As for tank engines, HD Construction Equipment signed a contract with Hyundai Rotem Company in January for 116 1,500-horsepower-class DV27K diesel engines to be installed in K2 tanks for export to Poland. Volumes may vary depending on the degree of localization, but if K2 exports expand, HD Construction Equipment’s tank-engine sales will rise accordingly. The company is also preparing for growing demand for battery packs for electric vehicles, electric construction equipment and industrial uses. The Gunsan plant has enough capacity to supply battery packs for up to 9,400 electric buses a year.
HD Construction Equipment says the Gunsan plant will enable stable, large-scale production of power-generation and defense engines as well as battery packs. The company says it has improved production and quality-control efficiency by introducing assembly robots, autonomous mobile robots (AMRs), equipment to detect quality defects in advance, and an integrated control tower, among other systems.
HD Construction Equipment underscored its commitment by renaming its Engine Business Division the “Power Solution Business Division” and unveiling the slogan “Powering the Next” that day. Profitability is behind the company’s focus on its engine business. In the third and fourth quarters, the engine division recorded sales of 394 billion won and operating profit of 55.2 billion won. It accounted for a share in the 20-percent range of sales but more than 30% of operating profit, giving it higher profitability than the company’s core construction equipment business.
HD Construction Equipment plans to maximize profits by expanding the share of its high-margin engine business. Using the Gunsan plant as a base, it aims to actively tap demand for defense engines and battery packs, led by power-generation engines for data centers, and reach engine sales of 2.5 trillion won by 2030. Engine sales totaled 1.3 trillion won last year.
HD Construction Equipment held a completion ceremony for its new engine plant that day at Gunsan National Industrial Complex. About 200 people attended, including HD Hyundai Vice Chairman Jo Young-cheol; HD Construction Equipment President Jae-young Moon; North Jeolla Province Governor Lee Won-taek; Democratic Party of Korea lawmaker Kim Eui-gyeom; Gunsan Mayor Kim Jae-jun; Park Tae-hyeon, Director General for Industrial AI Policy at the Ministry of Trade, Industry and Energy; and representatives of partner companies.
President Jae-young Moon said at the event, “We will realize future technologies in response to new energy demand and proactively create new business opportunities,” adding, “Through this, we will become a company that grows together with the local community.”

[email protected] Kim Yun-ho Reporter