Develon targets growth built on change and innovation

Loading, Hauling & Excavation / December 15, 2023
By Guy Woodford
Young-Cheul Cho, HD Hyundai Infracore CEO. Pic: Develon

Formerly Doosan Construction Equipment, Develon is an ambitious new brand built on a strong off-highway machine manufacturing history looking to make a big global impact, with a particular focus on the European market. In an Aggregates Business Q&A, HD Hyundai Infracore CEO Young-Cheul Cho discusses Develon's exciting growth plans.


How would you evaluate the global off-highway equipment customer market reception of the Develon brand since its launch?

Changing our brand name gave us a new start and aligned with our aim of moving towards change and innovation. Since the global launch of Develon in January this year, we have engaged in various activities such as dealer meetings, customer events, exhibitions, media work, and much more to share the new brand with customers all over the world and strengthen brand presence. Through these events, we have seen that our brand presence and confidence among customers are strong and secure.

Develon’s powerful and highly efficient DX800LC-7 crawler excavator Pic: Develon


How important is the European market to Develon?

We believe the European market is pivotal in elevating Develon into a top global player for several reasons. In the first instance, the region has large market demands, including infrastructure construction, mining, urban development, agriculture and landscaping. Europe is also one of the first regions where we have introduced eco-friendly construction equipment and new technologies, making it a crucial market when aiming to become a premium brand. 


Since the brand's launch, Develon has expanded its product portfolio from mid-to-large machines to mini-excavators, and we are working on further boosting our market position by strengthening our sales network. Develon is also actively participating in marketing activities to enhance brand awareness by connecting with customers at different levels and occasions, including product exhibitions at construction equipment trade shows, sponsoring the International Challenge Football Match between Wales and South Korea at the Cardiff City Stadium, OOHs, online ads and more.


How do you view the European construction, quarrying and mining equipment market – what are the biggest growth opportunities for Develon?

Building on the European construction market in which we have stable product demand, we are expanding to target the larger quarrying and mining equipment market as we see great potential in this area. Develon has quality products such as large excavators, large wheeled loaders and ADTs [articulated dump trucks], and an established sales network, making it easier to enter new markets. Surface mining is a market with great opportunities as it is similar to construction equipment. We have been engaging in related events such as the international demonstration fair steinexpo 2023 held in Homberg, Germany, in August, to exhibit and demonstrate our latest mining/quarrying excavators, wheeled loaders, and ADTs, showing the excellence of Develon equipment to customers.


What are the biggest challenges you're facing as a manufacturer, and what are the main challenges facing your European customers?

The construction equipment market fluctuates in accordance with the status of national construction and civil engineering industries. It is difficult to predict the market precisely, so the key is to flexibly respond to different industry cycles, in terms of sales and finance, to survive and grow in the market.

wheeled loader
The Develon DL550-7 is a productive and high-performing wheeled loader. Pic: Develon



Europe consists of different countries with different market and environmental requirements, meaning that customer needs and equipment usage differ based on the country. That is why providing different specifications, options, and features is important, but such versatility also causes confusion and difficulty when manufacturing different products.


Europe is also a leader in emission and eco-friendly regulations, meaning it is the market in which most brands first introduce newly launched products. This requires timely action towards fuel consumption reduction and electrification, thus becoming an accelerator for the company's technology development.


Could you outline your European business's growth strategy over the next 3-5 years?

We plan to create balance among our sales regions and product portfolio to create a full lineup that will help us grow into a global top player. Where we have a weaker presence, we plan to strengthen our dealer network while expanding our MEX lineup as Develon MEX products are near reaching the level of other leading global brands. We also plan to enhance customer satisfaction by delivering products that match market requests, such as diversifying excavator and wheeled loader options.


In addition, we are making investments to add more business location hubs within Europe. For example, we will establish a direct sales market in Germany, one of the largest markets we are involved in. A new customer support and training centre is being planned in Mannheim, Germany, where we had a ground-breaking ceremony this September. Along with the customer support and training centre, the 10,650m² site will include a machine demonstration area and parts warehouse targeted for opening in H2 2024. This site will be operated as a direct sales centre, the first of its kind for the European brand.


What is Develon's approach to decarbonisation and the wider sustainability and circular economy agenda? What innovations in this area can we expect from the brand?

We are integrating ways to tackle these issues into our business strategy as part of wider efforts to deal with the world climate crisis. Our first goal is to reorganise our current business portfolio and focus on developing hydrogen engines, electrification and other eco-friendly approaches to lead the next construction equipment generation. The second goal is to join global efforts to solve the global climate crisis by reaching carbon neutrality in our businesses by 2050. We plan to gradually reduce GHG emissions by 42% by 2030 and by 71% by 2040, compared to the levels in 2021.

Young-Cheul Cho says Develon is looking at ways to help tackle climate change as part of its business development strategy. Pic: Develon


"We have also become the first in the global construction equipment industry to join the RE100 initiative, which confirms that all energy used in business sites will be generated from renewable energy (solar, wind) by 2040. Such efforts have been initiated in our Gunsan plant in Korea, and will gradually expand to other global sites. Lastly, we plan to interact more actively with our customers by disclosing our efforts and processes to tackle climate change. Along with HD Hyundai's Construction Equipment business, Develon co-released the TCFD [Task Force on Climate-Related Financial Disclosures] report on its official website last June. This report will help identify financial risks and opportunities caused by climate change while assisting decision-making as it transparently discloses strategies towards climate change."


What R&D and product development is Develon involved in around alternative power/fuel for its European customer machines?

Develon is addressing the market with low-emission equipment to meet the Stage V standard and zero-emission electric excavators. Demand for eco-friendly equipment is expected to increase as environmental regulation policies and subsidies increase worldwide. Aside from governmental policies, certain companies will make purchasing and using eco-friendly equipment mandatory to institute ESG management. According to the global market research institution IDTechEx, global sales of electric construction equipment in 2042 are expected to reach 527,700 units, an eightyfold increase from the 6,300 units sold in 2022.


We are working on technology R&D to change our construction equipment line-up to electric machines and to transform our mid-to-large equipment to FCEVs (Fuel Cell Electric Vehicles). As part of this, we have just launched our new 1.7-tonne mini electric excavator equipped with our proprietary battery pack, 20 of which have already been sold in the European market. We are developing a 14-tonne wheeled electric excavator, which will be presented for the first time in Europe within the next three years, while the electric versions of each of our main models are planned to be developed by 2031. This will create a full electric product line from our small equipment to the mid-to-large equipment in our range.


As part of our effort to develop eco-friendly equipment, we are researching ways to improve battery efficiency and the electrification system for mid-sized or smaller equipment. H2 internal combustion engines (H2ICE) for 30 tonne and larger equipment are also being developed simultaneously. The development of H2ICEs is expected to be completed by 2025, while application tests on 20-30-tonne excavators are planned for 2026. We will continue efforts to proactively secure technologies related to applying eco-friendly power sources to different types of equipment.


Unmanned, automated machines are still developing, and requests for automated solutions are gradually increasing in the global market. There have been some collaboration requests as interest in unmanned equipment demonstration in various infrastructure construction sites, road construction, and mining sites has been increasing. Develon aims to collaborate with different sites to develop unmanned, automated technologies and work on on-site inspections to advance commercialisation of such future technologies.


We are continuing our development of the various technology bricks, which are part of the future complete solution CONCEPT-X. We have won two CES 2024 INNOVATION awards, which will be presented in Las Vegas, USA, in January 2024. Smart Collision Mitigation is a system that prevents the risk of job site accidents, and X-Agent is an AI-based machine-assistance solution that helps advance machine operation and productivity.

Develon’s DA45-7 4x4 articulated dump truck is a good option for European quarry customers. Pic: Develon


How would you describe the relationship between Develon and Hyundai Construction Equipment, being under the same umbrella of HD Hyundai Group? What trading advantages are there for Develon in being part of such a huge global group?

HD Hyundai is based on a holding company structure in which each company is in charge of independent and responsible management. HD Hyundai Infracore (HDI) with the brand Develon and HD Hyundai Construction Equipment (HCE) with the brand Hyundai will continue to operate independently with their brands in the market but will be cooperating under HD Hyundai XiteSolution, the intermediary holding company which represents the construction equipment business of HD Hyundai, to build more market presence. The two brands, Develon and Hyundai, will work together in various business sectors such as purchasing, R&D, human resources and more to create synergistic effects for the entire construction equipment business. As the two companies stay under HD Hyundai, they will be able to grow into leading players for future technologies as there will be more opportunities to research various fields such as AI convergence, hydrogen value chains and digital transformation. 


What does Develon offer its European customers regarding machine servicing, maintenance, premium parts replacement, and production performance monitoring?

We have a service called Develon Fleet Management, which monitors and manages not only customer's individual equipment but also fleets, all free of charge. Customers have responded positively to this service as it makes it easier to monitor and manage productivity, breakdowns and maintenance information for single or fleet equipment.


From next year, we will operate a Uptime Centre in Prague, Czech Republic, where our European HQ is located. This will enable us to respond ASAP whenever customers experience equipment failure, minimising machine downtime. We also plan to provide preventative measures for machine maintenance, such as oil sampling, to strengthen equipment management. 


How does the brand plan to further improve its offer across these areas?

We have been providing digital support through Develon Fleet Management for certain equipment management and maintenance processes, but we will be expanding services to a whole new level to cover the entire machine lifecycle. This will provide customers with digital support while operating any of their equipment.

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