HD Hyundai Heavy Industries announced on September 10, 2026, a total investment of 1.0722 trillion won — equivalent to approximately $747 million — to build two new production facilities in South Korea: one dedicated to land-based power generation engines, the other to the manufacturing of key components for small modular reactors (SMRs). The announcement was made through a regulatory stock exchange filing, making the commitment official and binding.
The portion allocated to SMRs amounts to 238.6 billion won. The new facility will be built within the company’s historic Ulsan shipyard, with completion expected in the first half of 2029. The choice of site is deliberate: the area already features heavy-duty infrastructure, a skilled workforce, and well-established supply chains — factors that reduce both startup time and costs. The remaining 833.6 billion won will fund a new HiMSEN engine production hub in Onsan, in the Ulju district of Ulsan. The facility will span approximately 215,000 square meters and will have an annual capacity of 3 gigawatts. Construction is set to begin in the first quarter of 2027, with operations expected to start by May 2028.
The driving force behind this decision is the energy demand from artificial intelligence data centers. These facilities operate around the clock and require a stable, continuous power supply — a need that SMRs can meet more reliably than many other energy sources. According to OECD projections, the global SMR market is expected to grow to 150 GW by 2050. Specialized component manufacturing for these reactors remains limited worldwide, which opens up market opportunities for companies that build production capacity now.
HD Hyundai Heavy Industries is not entering this space unprepared. In early 2026, the company had already signed power generation equipment supply agreements with Aperion Energy Group and Corban Energy Group in the United States, with a combined value exceeding 1.5 trillion won. That experience in the American data center energy infrastructure market accelerated the decision to develop its own industrial-scale production capabilities, both in gas engines and in the modular nuclear sector.
If plans hold up over the coming years, Ulsan could emerge as one of the world’s leading manufacturing hubs for SMR components. The market is still in its early stages, with competition taking shape across Europe, North America, and Asia. Moving now — with concrete investments and construction already planned — positions HD Hyundai Heavy Industries ahead of many competitors still stuck in the design phase.
