Transformer manufacturer's growth boosts CSX's role in U.S. energy sector
3/24/2026
By Bridget Dean, Associate Editor
A $200 million expansion underway at the CSX-served HD Hyundai Power Transformers USA (HDHPT) manufacturing facility in Montgomery, Alabama, will help fortify the U.S. power grid by enabling the company to produce larger, extra high-voltage power transformers.
For CSX, the expansion will drive traffic volumes, support the railroad’s long-term growth and strengthen its partnership with HDHPT, says CSX Director of Industrial Development Rashard Howard.
The manufacturer’s investment also solidifies Alabama’s position as a leader in advanced manufacturing and critical infrastructure production, said Ellen McNair, secretary of the Alabama Department of Commerce in a press release from the Montgomery Regional Chamber of Commerce.
“This expansion will be bringing on an additional 200 good-paying, livable-wage jobs to a community that CSX serves, and that is very gratifying for someone in my role,” Howard adds.
On March 6, CSX officials joined HDHPT officials and local community and government leaders for a groundbreaking on the expansion. Transformer production at the expanded facility is slated to begin in mid 2027, according to the Montgomery chamber.
HDHPT is expanding its production capabilities to address increasing demand for power grid modernization, driven by rapid growth in AI infrastructure and data centers, HDHPT officials shared in a LinkedIn post. The modern power transformer units will help replace aging equipment.
CSX officials joined HDHPT officials and Montgomery-area community and government leaders for a March 6 groundbreaking ceremony.CSXAbout 70% of the nation’s power transformers are in need of replacement, says Howard. Currently, HDHPT supplies about 15% of the United States’ large core-type power transformers, he adds.
CSX and HDHPT are long-time partners; Howard has worked with the manufacturing company since the original site selection phase of development in 2011. At the time, several communities were bidding for the project. CSX’s efforts helped secure the placement of HDHPT in a Montgomery greenfield site in close proximity to CSX rail infrastructure, says Howard.
“We work with government officials, state agencies, local community chambers of commerce, as well as power providers, gas providers and other utilities to come up with the best sites for these industries that are looking to ... use rail as a logistics solution,” he says.
CSX transports HDHPT’s finished products across the United States, but the power transformers manufactured at the Montgomery facility are larger than most freight-rail shipments, says Howard. Although units range in size based on customer needs, they’re typically beyond the standard height and width of rail cars, Howard says.
Enter CSX’s clearance bureau: The bureau specializes in routing these shipments through dedicated lanes with no overhead or sideline obstructions. Even the larger power transformer units HDHPT will produce once the expansion is completed will fit through these lanes, Howard says.
CSX also is helping HDHPT with the design of new rail infrastructure called for in the expansion, including a new rail spur.
The expansion project reinforces the value of strategic partnerships and the role of reliable rail transportation in enhancing national energy security, CSX officials say.
“Hyundai Power Transformers has put themselves in a position to make a good quality product that we at CSX can ship both safely and efficiently,” Howard adds. “[They are] an essential supplier for the country when it comes down to the nation’s power grid.”
