HD Hyundai Heavy Industries will invest KRW 1.07122 trillion in Ulsan to build a power engine plant to respond to electricity demand from artificial intelligence (AI) data centers and a dedicated plant for core equipment of small modular reactors (SMRs).

Ulsan City and HD Hyundai Heavy Industries signed a “New Power Engine and SMR Plant Investment Memorandum of Understanding” at Ulsan City Hall on the 22nd, with Ulsan Mayor Kim Sang-wook and HD Hyundai Heavy Industries CEO Lee Sang-kyun in attendance. Of the total, HD Hyundai Heavy Industries will invest KRW 833.6 billion to build a 3 GW (gigawatt) “HiMSEN engine” production base in Onsan-eup, Ulju-gun. On a site of approximately 215,000 m², an engine assembly and test-run plant, a crankshaft machining plant, and an engine block casting plant will be constructed. Construction is scheduled to begin in the first quarter of next year, with completion in May 2028, after which full-scale operations will commence.

HD Hyundai plans to expand its annual land-based power engine production capacity to 4 GW through the new Onsan plant and HD Hyundai Engine in Yeongam, Jeollanam-do. The HiMSEN engine is a medium-sized engine independently developed by HD Hyundai Heavy Industries. Based on technology accumulated in marine engines, the company intends to target the growing land-based power generation market driven by the expansion of AI data centers. At the main plant of HD Hyundai Heavy Industries in Dong-gu, the company will invest KRW 238.6 billion to build a dedicated plant for manufacturing SMR primary equipment, aiming for completion in the first half of 2029. SMRs are next-generation nuclear power plants with reduced output compared with conventional large nuclear plants and modularized key facilities.

HD Hyundai Heavy Industries initially considered investments in other regions but is reported to have selected Ulsan as the final investment site in light of the city’s swift licensing support and other factors. The company will give priority to Ulsan residents when hiring plant operation staff and will seek to expand transactions with local companies in construction, services, and materials procurement.

Ulsan City will provide administrative support through shortened licensing procedures and deregulation. CEO Lee stated, “This investment is an important starting point for leading the future energy industry market,” adding, “We will respond to the surging electricity demand and secure a leading position in the global AI infrastructure market.” Mayor Kim said, “We welcome HD Hyundai Heavy Industries’ large-scale investment,” and added, “We will actively support Ulsan’s growth into a global production base for the energy industry.”

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