Hyundai Rotem has staked its future on the bidding war for South Korea’s next-generation high-speed train project, estimated at approximately 5 trillion won (approximately $3.7 billion). Lee Yong-bae, president and CEO of Hyundai Rotem, stated at InnoTrans 2026, the world’s largest railway trade fair held in Berlin, Germany, that the company will devote its full resources to the KTX-1 replacement tender set to begin next year.
“No one can predict the outcome of a bid. We cannot be confident that we will win or lose,” Lee said. “However, we believe we have built a competitive high-speed train. We plan to participate in next year’s tender with genuine dedication and commitment.”
Korea Railroad Corporation (Korail) plans to introduce 49 distributed-power high-speed trainsets with a maximum speed of 320 km/h, totaling 784 cars, to replace the 46 first-generation KTX (KTX-1) trainsets that began service in 2004 and to expand transport capacity and reserve rolling stock. The total project is estimated at approximately 5 trillion won, with the first batch of 28 trainsets (448 cars) to be ordered next year. The trains are scheduled to be introduced sequentially starting in 2032.
Hyundai Rotem unveiled its next-generation high-speed train concept model, co-developed with Hyundai Motor Group, for the first time at the exhibition. The exterior and interior spaces were jointly developed with the Hyundai Design Center at Hyundai Motor Group’s Namyang Research Institute, placing passenger user experience (UX) at the center of vehicle design.
Cho Il-yeon, head of Hyundai Rotem’s Rail Solutions Business Division, emphasized: “Just as the existing KTX trains are being retired after roughly 30 years of service, the trains to be introduced this time will also be usable for at least 30 years, and up to 40 years when considering upgrades. High-speed rail has now moved beyond simply measuring speed, performance, and power—user experience has become critically important.”
Hyundai Motor Group Design DNA Applied
Hyundai Motor Group’s design capabilities were fully deployed in this concept model. With designers from Hyundai Motor Group as well as Hyundai Rotem participating in development, both the exterior and interior spaces underwent extensive improvements.
Lee Won-sang, head of Hyundai Rotem’s Rail Solutions Research Institute, explained: “We surveyed high-speed rail designs around the world, analyzed their strengths and weaknesses, and conducted direct interviews with customers. We examined everything from legroom and headroom in the existing KTX to the sense of openness from windows and inconveniences when using laptops.”
The exterior design focused on reducing aerodynamic drag during high-speed operation. Through a total of 520 hours of aerodynamic analysis and wind tunnel testing conducted with Hyundai Motor’s aerodynamics development team, the concept model achieved a drag coefficient approximately 36% lower than the existing KTX-Cheongryong. In the interior, legroom and luggage rack space were expanded, and the lower edge of windows was lowered to enhance the sense of openness.
“Even in high-speed rail, user experience (UX) and user interface (UI) are now becoming more important than speed, performance, and power,” Cho said. “We focused on reducing interior noise and improving ride comfort while securing performance of up to 370 km/h, faster than existing models.”
This concept design is not merely for display. Hyundai Rotem plans to use it as the foundation for vehicle designs to be applied to the EMU-370 (one trainset, 16 cars) with a maximum speed of 370 km/h contracted in August, as well as the KTX-1 replacement project expected to be ordered next year.
Overseas Competitor Participation a Key Variable
The potential entry of overseas railway manufacturers is seen as a major variable in this bidding war. As an international competitive tender, major foreign railway companies could participate directly or partner with domestic South Korean firms.
Regarding the possibility of overseas participation, Cho said: “We don’t know yet, but I believe there will certainly be interest.” On French manufacturer Alstom, which participated in the first-generation KTX project, he predicted: “Since this project replaces their existing fleet, they will clearly be interested.”
The KTX-1 was introduced to South Korea through a technology transfer agreement with Alstom in 1994. The initial 12 trainsets were produced as complete units in France, while the remaining 34 trainsets were divided among Hyundai Precision & Industries, Daewoo Heavy Industries, and Hanjin Heavy Industries for domestic production. The railway vehicle businesses of these three companies were later consolidated into what is now Hyundai Rotem. Domestic high-speed train technology has since evolved through the KTX-Sancheon, KTX-Eum, and KTX-Cheongryong.
In Korail’s 2023 tender for 136 EMU-320 cars, Hyundai Rotem competed against Woojin Industrial Systems. At the time, Woojin pursued technical cooperation with Spanish rolling stock manufacturer Talgo, but failed to meet the technical evaluation threshold, and Hyundai Rotem won the contract. This new project is far larger in scale.
Hyundai Rotem is touting its accumulated domestic high-speed train manufacturing experience and supply chain as competitive advantages. “The localization rate of Korean-type high-speed trains exceeds 87%, and including first-, second-, and third-tier suppliers, approximately 200 domestic companies drive the project together,” Cho emphasized. “Foreign companies entering the market would not have this, so we must defend this contract to protect the domestic industrial ecosystem.”
However, domestic tenders in South Korea do not provide separate scoring advantages based on localization rates. Lee Won-sang pointed to the United States’ “Buy America” provisions, noting: “Other countries have mechanisms that consider domestic industries, but South Korea lacks such provisions, which can be disappointing from the perspective of partner companies.”
A Springboard for Overseas Market Expansion
Hyundai Rotem envisions using this domestic contract as a springboard for expanding into overseas high-speed rail markets. The company first exported Korean-made high-speed trains to Uzbekistan in 2024, and an additional order for eight more trainsets is currently being pursued.
“In high-speed rail, we are still a latecomer compared to Alstom, Siemens, and China’s CRRC,” Cho said. “Overseas, buyers scrutinize how many high-speed rail projects you have completed and what track record you have not only in rolling stock but also in maintenance and operations.” He added: “The most critical factor in winning overseas high-speed rail contracts is rapidly building up these references.”
Hyundai Rotem plans to diversify its export markets starting with Uzbekistan and expanding into Central Asia and the Middle East. “Looking at high-speed rail recently, you can see many overseas passengers riding. High-speed rail is something that can representatively showcase South Korea’s image,” Cho said. “Internally within the group, there is a directive to create ‘world-class’ vehicles at the Genesis level even in high-speed rail.”
CEO Lee Yong-bae refrained from prematurely predicting the outcome while reiterating his determination to compete until the end. “You never know the result of a bid until the final announcement. We will pour our energy into it and do our best until the very end,” he said.