Korea's Power Equipment Big 3 Surpass 27 Trillion Won in Orders... Accelerating Shift to North America

With the replacement of aging power grids in the United States coinciding with rising demand for artificial intelligence (AI) data centers, Korea's three major power equipment companies-Hyosung Heavy Industries, HD Hyundai Electric, and LS Electric-are experiencing an unprecedented boom. The combined order backlog of these three companies recently surpassed 27 trillion won, with more than half of the total concentrated in the North American market. As a result, the portfolio of Korea's power industry is rapidly shifting toward North America.

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According to industry sources on February 3, LS Electric's total order backlog as of the end of last year reached approximately 5 trillion won, with the North American share expanding to around 60%. This represents the steepest growth among the three major Korean power equipment companies.

An industry insider analyzed, "The growth trend, which began with the supply of power equipment for local factories of Korean companies such as Samsung Electronics and LG Energy Solution in North America, has recently continued due to the surging demand for AI data center expansion by global big tech firms."

As of the third quarter of last year, HD Hyundai Electric recorded orders worth 6.983 billion dollars (about 10 trillion won). Of this, the North American share exceeded half, accounting for 50.7% (3.537 billion dollars, about 5 trillion won). In particular, North American orders soared by 83.9% quarter-on-quarter and 192.3% year-on-year, demonstrating explosive growth. The company is maximizing profitability in North America and Europe by maintaining a selective order policy focused on high-value ultra-high-voltage transformers.

Hyosung Heavy Industries holds the largest order backlog among the three companies, at approximately 11.9 trillion won. The North American share also approaches half of the total. The company is accelerating profitability improvements as it secures more high-margin projects such as ultra-high-voltage transformers. A notable achievement is the 360 billion won order for ultra-high-voltage circuit breakers for data centers in North America in June last year.

LS Electric North America Export Switchgear Panel. LS Electric

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On the back of this expansion in orders, all three companies achieved record-breaking results last year. Hyosung Heavy Industries posted sales of 5.9685 trillion won and operating profit of 747 billion won, up 21.9% and 106% year-on-year, respectively. Even in the fourth quarter alone, the company set new records with sales of 1.743 trillion won, operating profit of 260.5 billion won, and an operating margin of 14.9%-the highest both annually and quarterly.

HD Hyundai Electric recorded provisional sales of 4.0795 trillion won, surpassing the 4 trillion won mark for the first time. Operating profit surged 46.8% year-on-year to 995.3 billion won, the highest growth rate among the three companies. LS Electric also saw consolidated sales rise by 9% to 4.9622 trillion won and operating profit increase by 9.6% to 426.9 billion won compared to the previous year. Fourth-quarter sales (1.5208 trillion won) and operating profit (130.2 billion won) also reached quarterly highs.

The upward trend in performance for Korean power equipment companies is expected to continue until 2028, when local production facilities in North America begin full-scale operations. Hyosung Heavy Industries is investing a total of 300 million dollars (about 440 billion won) in a three-phase expansion of its ultra-high-voltage transformer plant in Memphis, Tennessee. Upon completion of the third phase in 2028, the plant's production capacity is expected to increase to 600-700 million dollars-about 1.5 times the current level.

HD Hyundai Electric is also set to complete its second plant at its Alabama subsidiary in the United States by July next year. Starting in 2028, when the investment effects are fully realized, annual additional sales from the Alabama subsidiary alone are expected to increase by up to 300 billion won.

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