Q&A: Develon CEO looks to the future

Young-cheul Cho, President and CEO of HD Hyundai Infracore

At Intermat, one year on from the Develon launch, he spoke to Construction Europe about the market and his vision for the brand.

Q: How well do you feel the Develon brand has been accepted by the market?

A: In 2021, our group acquired Doosan Infracore. At that time, the brand was Doosan, but we only had the right to use the name for three years.

We decided it was not necessary to wait three years to change the brand. After one-and-a-half years, we decided to change it.

We spent almost a year, before deciding on Develon, combining the words Develop and Onwards.

It’s hard to estimate the true impact, but in one year our market share has increased, and we have been successful in providing compact machines to the North American market and seen good results in Europe.

Q: Do you feel positive about your positioning in the market at the moment?

A: There has been a lot of change in the market, since Covid 19. Recently it has been quite good, but now it’s not looking so positive.

As Develon, we are on schedule to introduce new types of machines to the market, and we aim to announce them at the beginning of the second quarter of next year.

So far, Hyundai Construction Equipment and Hyundai Infracore have used one platform for machines, but with different identities.

A Develon ADT being demonstrated at Intermat. (Photo: KHL Group)

Moving forward, Hyundai Infracore is focusing on innovation and smart technology, as well as productivity and fuel efficiency. I think the timing very good for us, with exciting new technologies on the market.

Our next generation machines will use AI [artificial intelligence] and have sensors that will be reliable in all environments and all weathers, which will improve safety.

Q: Can you tell us about your power strategy and will we see Develon machines powered by alternative fuels in the future?

A: Here at Intermat, we are showing the new DX05, which is a 5 litre engine and the DX08, which is a 7.5 litre engine. These diesel engines have more power and durability and meet the latest emissions regulations.

But we are also showing other sustainable products, with electric and hybrid excavators and new battery packs, as well as a hydrogen combustion engine.

Next year, we will show a 14 tonne electric wheeled excavator and we are developing more battery-electric machines, below 30 tonnes.

Over 30 tonnes, we are working on hydrogen machines, but we cannot move too fast. We have to closely monitor the situation and take the right opportunities at the right time.

In a separate Q&A with journalists at Intermat, Mr Cho and the CEO of HD Hyundai Infracore Europe, Jayden Lim, expanded on topics including differentiation between Hyundai and Develon branded machines, and on plans for new product development.

HD Hyundai is the parent company of both HD Hyundai Infracore (HDI), which operates the Develon brand, and HD Hyundai Construction Equipment (HCE), with Hyundai branded machines. How will the two brands - Hyundai and Develon - work together and be differentiated?

Young-cheul Cho, CEO and President of HD Hyundai Infracore, speaking at Intermat 2024. (Photo: KHL Group)

Mr Cho did not go into extensive detail about differentiation, except to say that Develon would have a technology focus while Hyundai would be more aligned on “customer convenience”.

The two businesses are currently working on shared platforms for future machines, with differentiation on technology and customer options. He added that each brand would also be able to cross-sell products through its sister business.

Mr Cho confirmed that battery power would be used for mini and compact machines – three or four electric mini excavators are under development - while hydrogen combustion engines was the likely technology for larger machines in the 30 tonne segment and above.

E-powertrains are also being developed and will be ready in one or two years.

He reinforced the need for Develon to develop its compact line of machines, including mini excavators, compact wheeled loaders – being discussed for the European market - and compact tracked loaders for North America, the first of which will be introduced later this year (the DTL35 model).

Next year will also see the arrival of five new excavator models in the 20 to 30 tonne range, using a platform shared between Hyundai and Develon.

The company is ambitious to grow, but Mr Cho acknowledged it was a difficult moment in the market; “The world market is not that positive. Our plan is to expand compact machines to meet increased demand for these products…and to grow market share.”

European growth
In Europe, the company’s CEO, Jayden Lim, said Develon’s presence in the compact equipment market needed to be strengthened; “We are strong in the UK, and we will enhance our market presence and growth in Germany and France.”

There will be more company-owned stores in Germany in the second half of this year, and an larger dealer network in both France and Germany. The new company locations will be responsible for direct sales as well as supporting dealers.

Mr Lim said the rental market was a target for the business, but they would take a step by step approach, with a need to develop “reasonable pricing models” and also a plan to offer dedicated promotions for rental customers.

Develon as a brand is just one year old. Did global CEO Young-cheul Cho feel satisfied with progress? “It’s very difficult to calculate how much we achieved”, he said, “but we have more sales and higher market share in each country – including North America – so I think, based on this result, I am very happy. The feedback from customers is good.”