Competition heats up over development of eco-friendly construction equipment

Hyundai Construction Equipment's 1.8-ton electric excavator, left, and Volvo Construction Equipment's 2.5-ton electric excavator / Courtesy of each company

Hyundai Genuine goes greener to widen gap with Volvo

By Park Jae-hyuk

The global trend of pursuing carbon neutrality to cope with the climate crisis is also prevalent in Korea's construction industry. Manufacturers of construction equipment here have also vied fiercely to achieve early dominance in the eco-friendly construction equipment market.

Hyundai Genuine, Volvo Construction Equipment (Volvo CE) and Doosan Bobcat, as well as small-size local companies, have recently gone all out to develop excavators, forklifts and dump trucks powered by electricity or hydrogen fuel cells, instead of conventional diesel engines.

In 2019, HR E&I became the first Korean firm to develop an electric excavator. The Gimje-based construction equipment manufacturer has produced its 1-ton and 3.5-ton electric excavators in the North Jeolla Province city since earlier this year.

Volvo CE, which entered the Korean market by acquiring Samsung Heavy Industries' construction equipment business in 1998, showcased its 2.5-ton electric excavator last month in Korea for the first time in Asia, becoming the first major construction equipment maker to sell electric excavators in the domestic market.

The Swedish firm has also shipped its 22-ton electric excavators, built at its Changwon plant in South Gyeongsang Province, to Norway.

"Volvo Group, including Volvo CE, has ambitious goals of achieving a net-zero value chain by 2040, and aims to boost 35 percent of our sales through electric machines by 2030," Volvo Construction Equipment President of Region Asia Tomas Kuta said in a press conference last month. "We expect to discover a new opportunity with electric machines in the Korean market and will also continue considerable investment and support to take the leading position for electro-mobility."

In response to Volvo CE's attempt to increase its domestic market share with the new electric excavator, Hyundai Genuine's two subsidiaries ― Hyundai Construction Equipment (Hyundai CE) and Hyundai Doosan Infracore ― plan to launch 1.8-ton and 1.7-ton electric excavators during the first half of next year.

Hyundai Genuine seeks to achieve net-zero in all of its operations here and overseas by 2050.

The construction equipment unit of Hyundai Heavy Industries Group is likely to take advantage of its overwhelmingly larger market share, so as to gain the upper hand in the electric excavator market.

Although Volvo CE outstrips Hyundai Genuine in the global market, the Korean firm has occupied a nearly 70 percent domestic market share, since it took over Doosan Infracore in 2021. The Swedish firm's domestic market share has stood at around 20 percent.

"The carbon neutrality is a promise with our next generation to create a better future," Hyundai CE CEO Choi Cheol-gon said.

Hyundai Genuine's hydrogen-fueled excavator is on display at Hydrogen Mobility+ Show at KINTEX in Goyang, Gyeonggi Province, in this September 2021 file photo. Newsis

Transition to hydrogen

Construction industry officials, however, pointed out that it is still difficult to use batteries to operate larger machines, due to the lack of charging stations. Some users have even raised concerns about the safety of batteries installed in construction equipment.

Volvo CE's 2.5-ton electric excavator is equipped with batteries that can last up to four hours. Hyundai Genuine's machines will also use batteries that can last around four hours.

"Hydrogen should be used to operate larger machines," an industry official said.

In terms of the development of hydrogen-powered construction equipment, Hyundai Genuine appears to be a step ahead of Volvo CE.

Hyundai CE will start the mass-production of the world's first 14-ton hydrogen wheel excavator in 2026. Hyundai Doosan Infracore also launched a project to develop a hydrogen engine to be used for commercial vehicles, buses and construction equipment, as the company was chosen by the Korea Evaluation Institute of Industrial Technology as the institution to lead the state-run project.

"Our hydrogen engine will be used for medium and large-size commercial vehicles, as well as for medium and large-size generators," a Hyundai Doosan Infracore official said.

Volvo CE also admitted that larger equipment still has technical issues preventing full operation with electric batteries.

"Volvo CE considers the bigger possibility of large construction equipment to develop to embed fuel-cell battery as the alternative energy source, which will create high marketability of hydrogen construction equipment," the chief of Volvo CE's Asia operation said in an interview with Korea's three English-language daily newspapers last month.

The Swedish company has already developed the world's first hydrogen-fueled articulated dump truck, but its development of a hydrogen-powered excavator is underway.

"Volvo CE Changwon plant will improve its production line from small and medium-sized electric excavators to large hydrogen-based electric excavators," the company said.