HHI building diesel engine plant in Daegu with U.S. firm

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HHI building diesel engine plant in Daegu with U.S. firm

Hyundai Heavy Industries broke ground on a diesel engine plant in Daegu yesterday that it is building in conjunction with a leading U.S. engine manufacturer. The plant will be able to produce 50,000 engines a year.

The world’s No. 1 shipbuilder and Indiana-based Cummins made a total $66 million investment that gives each a 50 percent stake. The joint venture is called Hyundai-Cummins Engine. Mass production will begin at the plant in 2014.

Established in 1919, Cummins is the world’s biggest construction equipment engine manufacturer. Its sales hit $18 billion in 2011. HHI said the joint venture will help it secure a steady supply of engines for construction equipment as it is widely expanding its business in this field.

The shipbuilder’s construction equipment unit posted sales of $3.7 billion last year, up 29 percent from 2010. HHI expects the Daegu facility will generate over 5,000 new jobs and 2 trillion won ($1.8 billion) in economic effect.

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