"AI and Data Center Power Demand Now Entering Full-Scale Phase," Jo Seok, CEO of HD Hyundai Electric

Jo Seok, President of Hyundai Electric. / Photo by Hyunmin Kim kimhyun81@

"Until now, renewable energy and electric vehicles have driven power demand, but going forward, artificial intelligence (AI) and data centers will take the lead."

Jo Seok, CEO of HD Hyundai Electric, stated at the 2nd Energy Trade Forum special lecture held on the 51st floor of the Seoul Trade Tower on the 9th that the increase in power demand due to the expansion of AI and data centers will now begin in earnest.

In his special lecture titled "The End of Globalization and Energy Security," CEO Jo said, "With the trend of decarbonized electrification and the spread of digital technologies including AI, global power demand is increasing dramatically," adding, "Countries will continue to expand investments in power infrastructure to respond to the growing power demand."

HD Hyundai Electric started its business in 1977 as the charging business division of Hyundai Heavy Industries and spun off in April 2017. The company manufactures industrial power and distribution equipment such as transformers and circuit breakers. Recently, with the rapid increase in power demand due to the expansion of renewable energy, electric vehicles, AI, and data centers, HD Hyundai Electric's sales have also significantly increased. Last year, the company secured orders worth $3.564 billion, recorded sales of KRW 2.7028 trillion, and operating profit of KRW 315.2 billion. CEO Jo predicted, "Sales this year will exceed KRW 3 trillion."

Jo Seok, CEO of HD Hyundai Electric, is giving a special lecture at the 2nd Energy Trade Forum held at Trade Tower on the 9th. Photo by Kang Hee-jong

Having served as Vice Minister of the Ministry of Knowledge Economy (now Ministry of Trade, Industry and Energy), President of Korea Hydro & Nuclear Power, and Chairman of the World Nuclear Association, CEO Jo has been leading HD Hyundai Electric since 2020.

At the time of his appointment, HD Hyundai Electric's management situation was unfavorable, recording large operating losses. In 2019, the operating loss ratio reached 8.8%. CEO Jo said, "Since taking office, we have pursued about 1,700 management innovation tasks and implemented a profitability-focused order strategy by avoiding reckless low-price orders," adding, "From 2022, as the business conditions improved, we were able to achieve the best performance since the spin-off last year."

Recently, the stock price has also been soaring. The market capitalization of HD Hyundai Electric, which was KRW 350 billion at the beginning of Jo's tenure, rose approximately 33 times to KRW 11.6 trillion as of May. Based on these strong results, CEO Jo was confirmed for a third term at the shareholders' meeting earlier this year.

In his lecture, CEO Jo diagnosed that the world is currently shifting from an era of "energy transition" to an era of "energy security." He analyzed, "Energy transition was the most important issue over the past five years, but due to the pandemic, the Russia-Ukraine war, and other factors, deglobalization has accelerated, and energy security is rapidly becoming a matter of national survival."

CEO Jo also noted, "There is a growing trend among advanced country clients such as those in Europe and the United States to require calculation and certification of product carbon emissions," emphasizing, "Carbon neutrality has become a matter of survival for companies."

With the U.S. presidential election coming up in November, corporate uncertainty is also increasing. CEO Jo said, "If the U.S. government changes, there will be significant changes especially in energy policy," adding, "Many decisions are being postponed until after the U.S. election."