AI Computing Infrastructure Boosts Backup Power Demand, ICE Manufacturers Ramp Up Production Amid Backlogged Orders

"Our internal combustion engines for power generation exceeded 100,000 units in sales in 2025, with surging demand for models specially designed for data centers," a person in charge of the Power Energy Division of Weichai Power stated in a recent interview. At present, the group’s generator sets are operating at high capacity utilization rates, and data center-specific generating units are running at full production capacity.
Driven by the global wave of data center construction and widespread power shortages worldwide, power generation operations have emerged as the biggest growth driver for the internal combustion engine industry in the years ahead.
This strategic judgment is not exclusive to Weichai Power. Leading international power equipment giants have accelerated their layout in this field, kicking off fierce competition across the hundred-billion-yuan power generation track.
Surging Demand Fueled by Data Center Construction
"Data centers underpin core AI computing power. Even a one-second power outage can lead to incalculable losses, so backup power supplies must feature second-level startup, rapid parallel connection and long-duration stable operation," an on-site technician explained beside the M55 series diesel generator sets in Weichai Power’s production workshop.
Industry statistics show that boosted by AI advancement and digital infrastructure expansion, demand for data center generator sets has skyrocketed, with the global market volume projected to hit 23,000 units by 2030.
"Generator sets for data centers serve as critical emergency power supplies. Their core priority is not fuel efficiency optimization, but ultimate reliability and ultra-fast response speed," said a Weichai Power executive. "For emergency scenarios, three core indicators stand paramount: instant startup, quick parallel synchronization and fast load pick-up. The units must kick into operation immediately once mains power fails, synchronize rapidly when multiple units run in tandem, and sustain stable loads until grid power is restored."
Such stringent requirements have forced continuous breakthroughs in system design. Optimizations include precisely matched starters, refined combustion calibration, and auxiliary systems such as storage batteries and fuel heaters to guarantee reliable ignition under extreme ambient conditions. Meanwhile, matching turbochargers, optimizing underlying logic for self-developed ECUs (Engine Control Units), and fine-tuning the structural and performance coordination between engines and generating units enable swift recovery of voltage and frequency.
Data center power units feature high customization and innovative structural designs, among which containerized generator sets have become the mainstream solution. "A containerized unit is essentially a movable factory. Beyond the core diesel generating engine, it integrates oil supply, air intake & exhaust, power distribution, fire protection and other integrated systems. Its design no longer solely complies with internal combustion engine standards but aligns closely with civil engineering and factory construction codes," explained the lead technical officer of Weichai Power’s power generation division. This all-in-one design drastically cuts on-site installation and commissioning cycles, catering to the fast-track construction schedules of data centers, and is especially favored by overseas clients.
"The global data center power generation market is primarily dominated by China and the United States. The U.S. accounts for 44% of worldwide demand, followed closely by China," analyzed the director of Weichai Power’s Global Marketing Center. Driven by severe grid shortages and intensive data center construction, the North American market is expected to register an annual growth rate of 18% to 20%. Emerging markets including Southeast Asia and India, propelled by rapid industrialization, collectively make up nearly 30% of total global demand. Top manufacturers are scaling up production capacity to capitalize on this high-growth segment.
Leading Manufacturers Strategically Prioritize Power Generation Business
Against the backdrop of traditional transportation sector disruption brought by new energy vehicles, the industry has reached a consensus that power generation operations represent the "second growth curve" for internal combustion engine manufacturers. Against this backdrop, numerous enterprises are undergoing strategic transformation, with leading players expanding production capacity or launching resource integration through strategic alliances.
Shandong Heavy Industry Group recently incorporated Weichai Power’s power energy business as its seventh core business segment. This move is a typical microcosm of the industry-wide strategic shift, as internal combustion engine manufacturers are refocusing their capacity planning, business models and global market development toward power generation.
Previously, Cummins Inc. of the United States released its 2030 strategy, explicitly identifying power generation as the largest growth segment for its traditional businesses, and forecasting the global large-bore diesel generator market will reach USD 12 billion by 2030. Germany’s MTU also prioritizes power generation as a strategic core, focusing on its large-bore product lineup.
Upgraded business models further unlock growth potential. According to Weichai Power executives, the company has evolved from a mere equipment supplier into a comprehensive integrated energy solutions provider. Across Southeast Asia and Africa, it delivers full turnkey power station projects covering site survey, solution design, installation, commissioning and post-operation maintenance — clients only need to provide land and fuel supplies.
This integrated model delivers unmatched delivery speed. Traditional overseas data center projects take up to two years from planning to commissioning, while Chinese-manufactured diesel generator sets drastically shorten lead times; some projects can be fully completed within three months.
"Generating sets are the final component of data center construction, and delivery timelines directly determine project launch dates. For project owners, the revenue generated from early operation far outweighs marginal differences in equipment costs," noted Weichai Power’s overseas marketing director. In some overseas sites without grid access, its units even operate as primary power supplies temporarily, allowing clients to launch their digital services and recover capital investments ahead of schedule.
Multi-Technology Routes Drive Competitive Edge
"Upgraded emission standards and dual-carbon goals compel us to advance multiple technical routes simultaneously: we must consolidate our traditional strengths while seizing opportunities in new energy tracks," a Weichai Power executive summarized the core logic behind the industry’s technological transformation. For internal combustion engine manufacturers, parallel development of upgraded conventional diesel units, clean alternative fuel equipment and innovative new energy technologies has become universal industry practice.
High-end upgrading of traditional diesel engines continues to deepen. Weichai Power has rolled out its full M-series large-bore diesel engines covering a power range from 400 kW to 5,450 kW, boasting globally leading power coverage. Meanwhile, gas-fired units powered by clean fuels represent a fast-growing niche. Weichai Power has deployed a full lineup of gas engines spanning 400 kW to 6,300 kW; its models below 1.5 MW lead the domestic market, while 2 MW and above units match international top-tier standards, cutting carbon dioxide emissions by over 20% compared with diesel counterparts.
Competition in new energy technology hinges on forward-looking R&D investment. Weichai Power previously made a strategic investment in UK-based Ceres Power to introduce SOFC (Solid Oxide Fuel Cell) technology and launch high-power SOFC systems with a maximum power generation efficiency of 65%. Its proprietary integrated solution pairing SOFC primary power supply with large-bore backup generators drastically improves power supply reliability.
Despite industry headwinds including reliance on imported core components, geopolitical risks and volatile raw material prices, market participants remain bullish on the growth prospects of power generation operations. Market research predicts the global installed base of power-generation internal combustion engines will hit 800,000 units by 2030, including 23,000 data center-exclusive units, with the global large-bore power generation market maintaining an annual growth rate above 15%.
Experts from the China Internal Combustion Engine Industry Association explained that internal combustion engines feature high power density, instant startup and strong environmental adaptability, rendering them irreplaceable for emergency backup power and grid peak shaving applications. Moving forward, they will operate in complementary synergy with new energy power supplies.
Capital markets have already detected this industry trend. As of January 2026, more than 20 brokerages have released research reports recommending leading manufacturers of power-generation internal combustion engines. Chinese internal combustion engine manufacturers are narrowing the technological gap with global giants through technological innovation, capacity expansion and global layout. Moving forward, three core competitive factors will define market standing: speed of technological iteration, global delivery capacity and cost control. The competitive landscape of the industry will continue to reshape amid this ongoing industrial transformation.