HD Hyundai Heavy Industries is making a significant investment in land-based power engines and small modular reactors (SMRs) to enhance its future competitiveness.
On September 10, HD Hyundai Heavy Industries announced it will invest a total of 1.0722 trillion won to establish a new production base for power engines and a dedicated factory for SMR manufacturing.
Initially, the company will invest 833.6 billion won to build a new production facility for its HiMSEN engines in Onsan-eup, Ulsan, with a capacity of 3GW.
The new facility will cover approximately 215,000 square meters (about 52 acres) and will include an engine assembly and testing plant, a crankshaft machining plant, and an engine block casting plant. Construction is set to begin in the first quarter of next year, with completion expected in May 2028.
This investment is aimed at proactively addressing the rapidly increasing power demand from artificial intelligence (AI) data centers, leveraging decades of expertise in marine engine technology to accelerate its entry into the land power market.
HD Hyundai expects to secure an annual production capacity of 4GW for land-based power engines through this expansion. The production of HiMSEN engines will be diversified across different locations, allowing for more efficient production management.
The existing Ulsan plant will focus on manufacturing marine HiMSEN engines, while the new facility and HD Hyundai Engine in Yeongam, Jeollanam-do, will specialize in land-based HiMSEN engines.
Through this dual-location strategy, HD Hyundai anticipates increasing its total HiMSEN engine production capacity from the current 3GW to 7.2GW by 2030.
Additionally, HD Hyundai Heavy Industries will invest 238.6 billion won to establish a dedicated factory for SMR core equipment. This factory will be built on the site of the Ulsan shipyard, with completion targeted for the first half of 2029.
SMRs are next-generation nuclear power plants that reduce output compared to traditional large-scale reactors and modularize key equipment, offering advantages in stable power supply and carbon reduction. Interest in SMRs is growing rapidly due to the increasing number of AI data centers that require large-scale power around the clock.
According to the Organisation for Economic Co-operation and Development (OECD), the SMR market is projected to grow to 150GW by 2050. However, there are still few confirmed orders for the core equipment, indicating significant growth potential in the future.
To secure a leading position in the global SMR market, HD Hyundai is also solidifying its collaboration with TerraPower. On August 14, HD Hyundai Chairman Chung Ki-sun met with Bill Gates, founder and chairman of TerraPower, in Seoul to discuss cooperation on the commercialization of the next-generation SMR, the Natrium reactor.
A representative from HD Hyundai Heavy Industries stated, "This investment aims to secure core competitiveness in power engines and SMRs, which are gaining attention as new power sources in the AI era. We will proactively respond to the surging power demand and strive to dominate the global AI infrastructure market."
* This article has been translated by AI.
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