HD Hyundai Electric will invest 400 billion KRW by early next year to increase production at its transformer factories in Alabama, USA, and Ulsan by 30%. This move aims to capture the growing demand for electrical equipment in the United States.
According to industry sources on the 19th, HD Hyundai Electric plans to expand its Ulsan plant to increase ultra-high voltage transformer production from 300 units per year to approximately 360 units. The production capacity at the Alabama plant will also be expanded from 100 units annually to up to 150 units.
Once the expansions at both plants are completed early next year, HD Hyundai Electric's ultra-high voltage transformer production will increase by about 27.5%, from 400 units to around 510 units annually. These ultra-high voltage transformers, weighing over 200 tons each, are high-value electrical equipment priced between 6 billion and 13 billion KRW per unit.
The demand for replacing aging electrical equipment combined with new installations driven by the 'Artificial Intelligence (AI) boom' has already secured HD Hyundai Electric orders for five years' worth of work. The company expects the electrical equipment 'super cycle' to continue for more than five years, centered in the United States, and has decided on its largest investment since its founding in 1977 (then Hyundai Heavy Industries' Electrical Equipment Division). This investment exceeds the total operating profit of 315.2 billion KRW recorded in 2023.
According to market research firm Market.us, the global transformer market is expected to grow from 72 billion USD (approximately 105 trillion KRW) last year to 123 billion USD (approximately 180 trillion KRW) by 2033.
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