HD Construction Equipment targets Indonesian mining and US data-center power demand
HD Construction Equipment is opening a 20,000-square-meter service and logistics hub in Balikpapan to expand its Indonesian mining-equipment business. The company has also signed a KRW 390 billion contract to supply gas-generator engine long blocks for US data centers.
Balikpapan hub strengthens mining support
HD Construction Equipment is expanding in two overseas markets: heavy mining machinery in Indonesia and gas-fired generation equipment in the United States. Daily Hankook reported that the company has built an integrated hub covering about 20,000 square meters in Balikpapan, East Kalimantan, and plans to open it officially in the middle of this month.
Construction of the facility began in August 2024. It combines a parts warehouse, maintenance facilities and a technical training center and will support local dealers and sales to mining companies. Balikpapan is an industrial and logistics center in one of Indonesia’s main coal-producing regions, with mines and ports nearby. It is also close to the Nusantara capital-development project, which could support longer-term demand for construction equipment.
The company aims to reduce delivery times for key parts in Kalimantan to within 48 hours and raise parts availability above 90%. The hub will be linked with the parts distribution center established in Jakarta in 2023, which currently stocks about 15,000 items. Faster service is particularly important in mining, where equipment operates for long hours under difficult conditions and an unscheduled stoppage can interrupt production.
Service offering supports equipment sales
HD Construction Equipment plans to introduce full maintenance contracts under which service charges are reduced if an agreed equipment-availability level is not achieved. The model could give mining customers greater cost and uptime certainty while generating recurring maintenance revenue for the supplier. The company will also expand its remanufactured-parts business. It says these components can cut costs by as much as 40% while delivering about 90% of the performance of new parts.
Preventive maintenance will use the Hyundai Connect remote-monitoring system to identify potential failures. The company is also working with Indonesia’s Hasnur Group under a memorandum signed last year covering mining-equipment supply and operating solutions. Cooperation started with machinery including large wheel loaders and is intended to extend to field tests of electrified equipment and technology to improve operating efficiency.
The product mix is moving toward larger mining machines. While 20-tonne excavators previously represented more than half of local sales, the company is adding 125-tonne excavators and dump trucks. Last year it sold four 125-tonne excavators and 13 dump trucks. Its target for this year is about 1,300 Hyundai and Develon machines in Indonesia, 16% more than the previous year.
Competition in Indonesia and a US engine contract
Indonesia has annual construction-equipment demand of about 20,000 units, representing half of Southeast Asian demand, according to Daily Hankook. Mordor Intelligence forecasts that the Indonesian market will grow from $3.62 billion this year to $4.89 billion in 2031. HD Construction Equipment currently operates 40 dealer locations, eight field-support facilities and four service bases in the country. It wants the combined Hyundai and Develon share to reach double digits and enter the top five within five years.
The company faces established competitors including Komatsu, Hitachi and Caterpillar, as well as Chinese manufacturers Sany and XCMG. Chinese suppliers are expanding through price competition, leaving HD Construction Equipment to differentiate itself through parts availability, maintenance capacity and lower ownership costs rather than machinery prices alone.
Expansion also extends to power-generation engines. The company said it signed a contract worth about KRW 390 billion with US power-infrastructure specialist ERock to supply 22-liter high-efficiency long blocks from next year through 2028. The engines will be installed in generator sets supplying large data centers operated by US technology companies. Formed through the January merger of HD Hyundai Construction Equipment and HD Hyundai Infracore, HD Construction Equipment is targeting global revenue of KRW 14.1 trillion by 2030.