KB News Desk
HD Hyundai Heavy Industries said Thursday it will invest 1.07 trillion won ($799 million) in dedicated production facilities for land-based power engines and small modular reactors, targeting rising electricity demand from artificial intelligence data centers.
Of the total, 833.6 billion won will go toward a new HiMSEN engine production base in Onsan, Ulsan, with an annual capacity of 3 gigawatts. The complex will include dedicated facilities for engine assembly and testing, crankshaft machining and engine-block casting.
Construction is scheduled to begin in the first quarter of next year, with full operations targeted for May 2028. Together with output from HD Hyundai Engine’s plant in Yeongam, South Jeolla Province, the facilities will be able to produce 4 GW of land-based power engines annually.
HD Hyundai Heavy Industries aims to use its decades of marine-engine expertise to meet surging global demand for reliable power generation, particularly from rapidly expanding AI data centers.
The investment also marks an effort to reduce the company’s reliance on marine engines. Its existing Ulsan plant will remain focused on engines for ships, while the new Onsan facility and the Yeongam plant will lead the commercialization of land-based power solutions.
Through the expansion, HD Hyundai Heavy Industries expects its total annual HiMSEN engine production capacity, including marine and land-based units, to rise from 3 GW currently to 7.2 GW by 2030.
The remaining 238.6 billion won will be invested in a plant for manufacturing key SMR components within the company’s Ulsan shipyard. Completion is targeted for the first half of 2029.
HD Hyundai Heavy Industries identified SMRs as a promising source of carbon-free, around-the-clock electricity for power-intensive AI data centers.
The global SMR market could reach 150 GW by 2050, according to the Organization for Economic Cooperation and Development, creating opportunities for manufacturers of essential reactor equipment.
The investment builds on HD Hyundai Heavy Industries’ recent expansion into data center power infrastructure. Earlier this year, it secured supply agreements worth 627.1 billion won with US-based Apeiron Energy Group and 956 billion won with Coban Energy Group, marking its entry into the North American market.
