HD Hyundai Electric's Alabama subsidiary in the United States. [HD Hyundai Electric]
HD Hyundai Electric's Alabama subsidiary in the United States. [HD Hyundai Electric]

HD Hyundai Electric's largest customer has shifted from Saudi Arabia's state electricity authority to a North American power company — a change driven by an explosion in demand for power equipment as massive AI investment pours into the region.

According to industry sources, HD Hyundai Electric's top revenue source in the first half of this year was NextEra Energy, a North American power and energy company, which accounted for 15.9 percent of sales. The Saudi Electricity Company, the second-largest source at 5 percent, trailed by more than 10 percentage points. Sales from NextEra Energy reached 347.2 billion won ($251 million), more than three times the 109.1 billion won generated from the Saudi Electricity Company.

As a North American power firm has risen to the top, overall North American sales have surged as well. HD Hyundai Electric's North American sales in the first half of this year reached 1.03 trillion won, up 46.3 percent from 706.7 billion won in the same period last year. North America now accounts for 47 percent of the company's total sales.

An ultra-high-voltage transformer made by HD Hyundai Electric. [HD Hyundai Electric]
An ultra-high-voltage transformer made by HD Hyundai Electric. [HD Hyundai Electric]

From 2022 through last year, the Saudi Electricity Company had consistently been HD Hyundai Electric's largest revenue source, a position attributed to active infrastructure investment within Saudi Arabia and HD Hyundai's strong foothold in the Middle East. This year, however, North American power and energy companies have taken that top spot.

The shift reflects a sharp surge in demand for power equipment centered on North America. As global big-tech companies have poured large-scale AI investment into data centers and related infrastructure in the region, demand for supporting power infrastructure has grown in tandem. HD Hyundai Electric has ridden that wave, stringing together a series of orders in North America on the strength of its ultra-high-voltage transformers.

North American companies are expected to hold the top position among HD Hyundai Electric's customers for the foreseeable future. In the first half of this year alone, the company signed new orders in North America worth $2.17 billion — close to its full-year North American order total of $2.18 billion last year, and up to 12 times the value of orders from Europe ($169 million) and the Middle East ($270 million) over the same period.

The North American order streak shows no sign of stopping. Demand for power equipment remains unrelenting, driven by a combination of big-tech investment and the need to replace aging power infrastructure. Market research firm Mordor Intelligence projects the North American transformer market will grow from $10.93 billion this year at an annual average rate of 7.12 percent, reaching $15.42 billion by 2031.

HD Hyundai Electric has been expanding its local factory capacity well ahead of the demand curve. The company has committed $200 million to the expansion, which will increase its ultra-high-voltage transformer production capacity by 50 percent once complete.

Meanwhile, other power equipment makers including Hyosung Heavy Industries and LS Electric are also aggressively targeting North American sales. Hyosung Heavy Industries' North American share of sales stood at 38 percent in the second quarter of this year, up 15 percentage points from 23 percent in the same period last year. Over the same period, North America's share of new orders rose from 53 percent to 63 percent.

LS Electric posted second-quarter North American sales of 400 billion won, a record for any single quarter. The company is fulfilling orders through local production bases including LS Electric Utah and its Texas Bastrop campus.


yeongdai@heraldcorp.com