Hyosung Heavy Industries signed separate memorandums of understanding (MOUs) with the Vietnamese government and agencies for power equipment to upgrade the power grid and to secure a production base for high-voltage motors.
Hyosung Heavy Industries said on the 24th that it signed two MOUs for cooperation on power solutions and for building a new plant with Vietnam Electricity (EVN) and the Investment Promotion Center at the Korea-Vietnam Business Forum held at the JW Marriott Hotel in Hanoi on the 23rd (local time).
Vietnam is a region where power demand is rapidly increasing due to economic growth, industrialization, and the expansion of data centers and high-tech industries. Securing the stability of the power system amid the expansion of renewable energy has emerged as a key task.
Through the eighth Power Development Plan (PDP8), the Vietnamese government plans to expand total power generation capacity to 221 gigawatts (GW) by 2030 and invest about $136 billion in developing power sources and building transmission networks.
Hyosung Heavy Industries plans to cooperate in three areas: ▲ pilot application of the artificial intelligence (AI)-based power asset management solution (ARMOUR+) ▲ strengthening the stability of Vietnam's power grid by expanding the introduction of static synchronous compensators (STATCOM) ▲ providing technical education and training to enhance the design and manufacturing capabilities of Dong Anh Electrical Equipment Corporation (EEMC), an EVN power equipment subsidiary.
Hyosung Heavy Industries also signed an MOU with IPC to support investment in building a new high-voltage motor plant.
Under the agreement, Hyosung Heavy Industries plans to invest about $50 million to build a production base with annual sales of $100 million on the site of the Vinagi Electric plant in Dong Nai Province, Vietnam, and to install production facilities for 25,000-kilowatt (kW) class high-voltage motors used in nuclear power plants and other facilities, with mass production to begin in earnest in Feb. next year.
The Investment Promotion Center plans to support the provision of site information, permits and administrative procedures, and consultations with related agencies.
High-voltage motors use voltages of 1,000 volts (V) or higher and are used in large industrial facilities such as power plants and plants. With the recent increase in industrial power demand, demand for high-efficiency high-voltage motors is also growing.
Hyosung Heavy Industries expects high-voltage motors to become even more important in data center cooling systems and renewable energy linkage facilities. According to market research firm Omdia, the global high-voltage motor market is expected to grow by more than 5% annually to about $6.5 billion by 2028.
Hyosung has invested about $4 billion in Vietnam across all business divisions since entering the country in 2008. It has built six production bases in southern Dong Nai Province and Ba Ria-Vung Tau Province, central Quang Nam Province, and northern Bac Ninh Province. It currently employs more than 10,000 local staff.
According to Hyosung Heavy Industries, this is the third-largest scale among Korean companies invested in Vietnam, and the local subsidiary's revenue is about 1% of Vietnam's total exports.
Chairman Cho Hyun-joon of Hyosung said, "This agreement is meaningful in that Hyosung is expanding its business base in Vietnam from textiles to heavy industry," and added, "We will grow together with Vietnam as a global partner going forward."