In recent years, the global data center market has demonstrated vigorous growth, primarily driven by the continuous iteration and development of information technologies such as cloud computing, big data, the Internet of Things, and artificial intelligence (AI) big models. During this period, the data center market has maintained a strong growth momentum of over 10%. Notably, China’s data center market achieved remarkable success in 2023, with its market size reaching approximately 240.7 billion RMB, the growth rate of 26.68%, far surpassing the global average and nearly double the global growth rate. It is expected that the size of China’s data center market will surpass 300 billion RMB in 2024.
Among the key infrastructure of data centers, diesel generator sets, as backup power systems, play a crucial role. In the event of a power outage, diesel generators can quickly start up, load, and continuously and stably supply power, ensuring the normal and reliable operation of data centers until the public power supply is fully restored. Diesel generators account for up to 23% of the data center infrastructure costs, underscoring their irreplaceable role in ensuring the stable operation of data centers. Currently, diesel generators remain the preferred backup power solution for data centers, with no effective alternatives in sight.
Recently, the capital market has shown a high level of attention to the market dynamics of high-power diesel generators for data centers. Several major domestic data center diesel generator suppliers, such as Tellhow power, Cooltech Power, Weichai Heavy Machinery, SUMEC group, and Shanghai Diesel power, have seen their stock prices hit the daily limit. This phenomenon not only reflects concerns about the supply shortage of diesel generators for data centers but also highlights investors’ optimistic expectations for the future performance growth of these companies. In addition to the well-known companies that have already entered the capital market, there are approximately 15 other domestic companies with certain scale that can provide large-power diesel generator sets for data centers.
Since April 2024, with the rapid development of global data centers, intelligent computing centers, and other new infrastructure, the market for diesel generators used in data centers, which was originally a buyer’s market, has quickly shifted to a seller’s market. High-power diesel generators for data centers have been in short supply globally, with some customers even willing to pay a premium to ensure the smooth progress of their data center projects. However, the real reason for the market shortage is not a lack of diesel generator production itself, but rather the limited production capacity of their core components—the high-power diesel engines.
As major global manufacturers of high-power diesel engines and generator sets, companies like Cummins, MTU, Mitsubishi, Caterpillar, and Kohler are facing enormous production pressure, with related orders scheduled well into 2027. As the market continues to heat up, Aksa Power generation, a long-established diesel generator manufacturer from Turkey, has recently also actively entered this market. In China’s high-power diesel engine market, companies such as Yuchai Power, Weichai Power, Pangoo Power, Shanghai Diesel Power, and Jichai have become important participants in the data center diesel generator market. With the continued growth of the data center market, these companies are expected to gain more development opportunities and market share, entering a golden period of growth.
Although the current shortage of diesel generators for data centers presents challenges for the market, it also creates new opportunities and space for development. Driven by China’s “Intelligent Manufacturing,” the domestic diesel generator industry is gradually rising, with an increasing number of domestic companies entering the high-end diesel generator field and making significant progress in technological research and production capacity. These companies not only offer high cost-effectiveness and fast delivery capabilities, but also demonstrate strong competitiveness in customization services and after-sales support. Therefore, with continuous domestic technological advancement and the improvement of the industrial chain, Chinese manufacturing is expected to replace overseas brands in the field of critical infrastructure for data centers, becoming the dominant force in the market.
In addition, the 24th China (Shanghai) International Power Equipment and Generator Set Exhibition and the 11th China (Shanghai) International Data Center Industry Exhibition will be jointly held from June 11-13, 2025, at the Shanghai New International Expo Centre. With an exhibition scale of nearly 60,000 square meters, this grand event not only provides a platform for domestic and international power equipment and generator set manufacturers to showcase their products and technologies, but also offers an important opportunity for industry communication and cooperation. It is believed that at the upcoming exhibition, we will see more innovative products and solutions that will jointly promote the continued development and progress of critical infrastructure in the data center field.
Post time: Dec-29-2024