The order performance of domestic power equipment companies with Big Tech (large technology firms) is becoming visible. This is because stable power supply has emerged as the top priority for building artificial intelligence (AI) data centers.
According to industry sources on the 5th, HD Hyundai Electric is in negotiations for large-scale long-term supply contracts with three global Big Tech companies. The contract scale is expected to be similar to the 1.1 trillion won deal signed last month with Big Tech Company A, and discussions are underway to supply both power transformers and distribution transformers together. With Company A, there is even talk of securing additional orders exceeding the existing contract volume, targeting deliveries in 2029–2030. If procurement proceeds as originally planned, the share of orders for AI data centers within the power business is expected to rise from 1.8% last year to 6.3% this year and reach 16% next year.
LS Electric has also secured approximately 1.2 trillion won in orders from North American Big Tech companies in the first half of this year alone. The company is recognized for its competitiveness, having built capabilities to supply all aspects of AI data center power facilities, from ultra-high-voltage transformers to high- and low-voltage switchgear and power management systems. It is reported that inquiries from Big Tech firms are also coming in succession to competitors such as Hyosung Heavy Industries and Iljin Electric.
In particular, with the growing possibility of contracts not only with North American energy companies but also with Big Tech, some companies have already seen their cumulative first-half (January–June) order values exceed 90% of last year's full-year figures. In fact, Hyosung Heavy Industries' cumulative new orders for the first half reached 7.4981 trillion won, accounting for 99% of its full-year orders last year (7.6 trillion won). LS Electric recorded first-half orders of 3.2 trillion won, approaching last year's performance (3.7 trillion won). HD Hyundai Electric signed contracts worth $3.237 billion during the same period, achieving 76% of its full-year orders last year (approximately $4.27 billion).
Domestic power equipment companies are increasingly raising their annual new order targets set at the beginning of the year, signaling confidence. Hyosung Heavy Industries recently raised its annual new order target from 8.4 trillion won to 12 trillion won. HD Hyundai Electric also adjusted its target upward from $4.222 billion to $5.185 billion. An industry executive emphasized, "The strong order momentum will continue into the second half of the year, as we are negotiating supply volumes for 2029–2030 well in advance."
As this supplier-favorable market takes shape, domestic power equipment companies are accelerating their expansion of production capacity in North America. Industry sources also mention the possibility of further expansion. HD Hyundai Electric is moving forward with the construction of a second factory in Alabama, U.S. Once the expansion is completed by April next year, annual power transformer production capacity is expected to increase by approximately 50%. Hyosung Heavy Industries is proceeding with its third expansion at its Memphis plant in the U.S., aiming to expand production capacity by more than 50% by 2028. LS Electric is also expanding investments in key production bases such as 'LS Electric Utah' in Utah and 'Bastrop Campus' in Texas. The Utah expansion is scheduled for completion in the second half of next year.
An industry executive stated, "Since the end of last year, a situation has persisted where supply capacity cannot keep up with the pace of customer inquiries," adding, "We will seize the market by adopting customized strategies, such as configuring product packages for Big Tech."
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