[News Space=Reporter seungwon lee] LS Group's US affiliate, Essex Solutions, is operating production lines at full capacity at its factories in Canada and Italy to respond to the rapidly increasing demand for special windings for transformers in North America and Europe.

Special windings for transformers are seeing a surge in orders due to the recent increase in artificial intelligence (AI) data centers and the fact that approximately 70% of transformers in the U.S. are due for replacement.

Driven by explosive orders, this business unit of Essex Solutions has recorded a compound annual growth rate of 11% in North America and 8% in Europe, respectively, over the past four years, and achieved sales of approximately $129 million (approximately KRW 190 billion) last year. Essex Solutions plans to increase its market share of this product in North America and Europe from the current 19% and 28% to 50% and 35% by 2028, respectively.

To this end, Essex Solutions, which recently added two production lines to its North American manufacturing facility, plans to increase its production capacity (CAPA) from the current 3,500 tons to 8,500 tons by 2030, expanding by 143%. Essex Solutions’ European plant plans to increase its production capacity from the current 11,000 tons to a maximum of 15,000 tons by improving facility operation efficiency and replacing aging facilities.

This production capacity expansion plan is a strategy to efficiently respond to the continuous increase in demand in the North American and European markets. The special winding industry for transformers generally operates by securing orders for 3 to 6 months and producing them, but the current market is experiencing a severe supply shortage to the point where it takes more than 2 years from order to delivery. This supply and demand imbalance is expected to continue until 2030, and sales in related industries are growing rapidly due to increased demand.

An official from Essex Solutions said, “Based on innovation in manufacturing technology for special windings for transformers and efficient facility investment, we will actively respond to the diverse needs of our customers and further solidify our position in global markets such as North America and Europe,” adding, “We will continue to increase our production capacity to establish ourselves as a key partner in the transformer industry.”