Hydrogen Value Chains Have Been Localized, but a Profitable Business Model Is Still a Long Way Off

There’s a question that always shadows any talk of the hydrogen economy: it sounds promising, but aren’t the core equipment and materials still imported? At this point, that question is no longer as easy to answer as it once was. The equipment that produces hydrogen, the tanks that store it, the containers used in transport, the fuel cells that convert it into electricity, and even the membranes and gaskets inside them now clearly bear the names of Korean companies. The hydrogen economy value chain is no longer just a slogan; it has entered a stage where Korean companies are actually filling out the chain from production to storage and transport, fuel-cell applications, and key components.

That said, this is no time to get carried away. Localization does not automatically mean industrial self-reliance. Even if stationary fuel cells are considered world-class, losses continue to pile up, and water electrolysis, often seen as the symbol of green hydrogen, still struggles with heavy economic constraints. Demand, too, remains heavily dependent on policy support such as CHPS, hydrogen vehicle deployment, and the buildout of hydrogen refueling stations. Being able to make something and being able to sell it at scale for a profit are two very different things. That is exactly why this moment matters. Korea’s hydrogen industry has finally moved beyond the question of “can we do it?” and into the phase of asking “when can it stand on its own?”

Production, Storage, and Transport — Making and Containing Hydrogen (4 companies)

On the production, storage, and transport side, the value chain’s backbone already looks fairly solid. JNK Global was the first in Korea to localize hydrogen extractors—better known as reformers—and it has also moved into onsite hydrogen refueling stations. Gphilos has power conversion systems (PCS) for fuel cells and water electrolysis, along with a 100kW-class PEM water electrolysis system. In other words, one side is focused on producing hydrogen that can be used right now, while the other is preparing equipment aligned with the long-term logic of green hydrogen. The key point in hydrogen production is that Korean companies are already positioned across the spectrum, from localized reformers to water electrolysis equipment.

Moving into storage and transport, Iljin Hysolus and HS Hyosung Advanced Materials stand out clearly. Iljin Hysolus is Korea’s leading Type 4 hydrogen storage tank company, supplying Hyundai Motor’s NEXO exclusively while also making tube trailers. HS Hyosung Advanced Materials is the only company in Korea mass-producing TANSOME carbon fiber, which underpins the materials used in high-pressure hydrogen vessels. In other words, both the tanks and the carbon fiber that makes those tanks possible are connected through a domestic supply chain. Still, reality is unforgiving. Since the pace of hydrogen vehicle adoption and refueling infrastructure buildout depends heavily on policy and subsidies, the storage and transport ecosystem ultimately needs actual vehicle deployment and refueling demand to scale before the numbers really work. Being able to make tanks is not the same thing as having a market open up enough to support them.

Company	Core focus
JNK Global	First in Korea to localize hydrogen extractors (reformers) · onsite hydrogen refueling stations — formerly JNK Heaters
Gphilos	Power conversion systems (PCS) for fuel cells and water electrolysis + 100kW-class PEM water electrolysis system (unlisted)
Iljin Hysolus	Korea’s leading Type 4 hydrogen storage tank company — exclusive supplier for Hyundai Motor’s NEXO · tube trailers
HS Hyosung Advanced Materials	Only company in Korea mass-producing carbon fiber (TANSOME) — material for high-pressure hydrogen vessels (formerly Hyosung Advanced Materials)

Fuel Cell Systems — Turning Hydrogen into Electricity (3 companies)

The fuel cell systems segment is about as close as it gets to the pride of Korea’s hydrogen industry. Doosan Fuel Cell is the domestic leader in PAFC fuel cells for power generation, with cumulative market share of roughly 49%, and it is also pushing toward mass production of SOFCs. S-Fuelcell is the No. 1 player in PEMFC fuel cells for buildings in Korea, accounting for about 60% of the market, and it also operates in PAFC for power generation. Bumhan Fuel Cell supplied the Jangbogo-III program, becoming the world’s second company to commercialize submarine fuel cells, and has extended its business into building fuel cells and hydrogen refueling stations. Fuel cell systems are a rare area where Korean companies have already proven their presence across every segment—from power generation and buildings to submarines.

But here too, the shadow of the numbers looms large. Doosan Fuel Cell can credibly claim world-class competitiveness, yet it continues to post losses. Why is that? The fuel cell industry has high technological barriers and installed base matters, but at the same time, orders and demand are highly sensitive to policy timing. CHPS will clearly help expand the market, but mandates alone do not automatically guarantee stable profitability for companies. The same goes for building applications. Even if S-Fuelcell and Bumhan Fuel Cell steadily build their positions, the industry only becomes truly robust when post-installation maintenance and broader adoption continue on a self-sustaining basis. For now, this is still a phase where strong technology coexists with a still-weak profit structure.

Company	Core focus
Doosan Fuel Cell	No. 1 in domestic fuel cells for power generation (phosphoric acid PAFC; cumulative ~49%) — pursuing SOFC mass production (losses continue)
S-Fuelcell	No. 1 in domestic fuel cells for buildings (PEMFC, ~60%) · PAFC for power generation — to be renamed S-Prism in 2026
Bumhan Fuel Cell	Submarine fuel cells (supplied to Jangbogo-III; world’s second commercialization) · building applications · hydrogen refueling stations

Core Fuel Cell Materials & Components — Localization Inside the Stack (4 companies)

The truly meaningful changes are even clearer inside the stack. Kolon Industries is the world’s No. 1 player in fuel cell humidifiers and the only company in Korea that produces both PEM and MEA. Sang-A Frontec localized reinforced electrolyte membranes (ePTFE) for hydrogen vehicles and fuel cells, breaking U.S.-based Gore’s monopoly. Vinatech produces fuel cell substrates, catalysts, and MEAs in an integrated process, while Pyunghwa Holdings, through its subsidiaries Pyunghwa Oil Seal and PFS, supplies all fuel cell stack gaskets for the NEXO and hydrogen buses. The biggest advance in Korea’s hydrogen industry is that localization has actually been achieved in the core materials and components that determine fuel cell performance and durability.

Sang-A Frontec’s localization of ePTFE is especially symbolic. A monopoly always creates a weak link in an industry. Breaking that link means far more than simply securing an alternative supplier. The same goes for Kolon Industries being the global No. 1 in humidifiers and producing both PEM and MEA. If finished-product companies want to lead from the front, the materials and components makers supporting them from behind ultimately have to hold the line. Pyunghwa Holdings’ gaskets and Vinatech’s integrated production of substrates, catalysts, and MEAs show exactly that reality. Localization in the hydrogen industry is not about one or two flashy end products. It only becomes a real industry when these invisible layers of components begin to stack up.

Company	Core strength
Kolon Industries	World’s No. 1 in fuel cell humidifiers + Korea’s only simultaneous producer of PEM and MEA
Sang-A Frontec	Localized reinforced electrolyte membranes (ePTFE) for hydrogen vehicles and fuel cells — broke through Gore’s U.S. monopoly
Vinatech	Integrated production of fuel cell substrates, catalysts, and MEAs (+ global leader in supercapacitors)
Pyunghwa Holdings	Fuel cell stack gaskets — sole supplier for the NEXO and hydrogen buses (via subsidiaries Pyunghwa Oil Seal and PFS)

What to Watch Going Forward

The next phase is clear. The Clean Hydrogen Portfolio Standard (CHPS) will push power-generation demand, while hydrogen vehicle and hydrogen refueling station policies will support the storage, transport, and components ecosystem. Over the longer term, electrolysis-based green hydrogen will reshape the production side of the market. That is exactly why reformer-focused names like JNK Global and electrolysis/PCS-focused names like GPhilos are mentioned together. Today’s gray-hydrogen-centered reality and the coming shift to clean hydrogen are moving forward simultaneously within the same market. Policy is already moving every stage of the hydrogen value chain, but the next wave of growth will have to be proven not by subsidies, but by economics.

This is where the most uncomfortable questions cannot be avoided. When will green hydrogen become cheap? When will fuel cells turn profitable? When will demand for hydrogen vehicles and refueling stations stand on its own without policy support? Korea’s hydrogen industry has moved well beyond the stage of technological insufficiency, but it still has not reached the stage of business self-sufficiency. That does not mean the entire sector should be dismissed because of that gap. Localization has clearly been achieved, and that alone has broadened the industry’s options. But the market is unforgiving. The chapter after localization is sales, profits, and repeat orders. Only the companies that clear that hurdle will remain the real winners.

※ This article organizes company names, core businesses, and market positions based on publicly available materials verified online, and some assessments reflect the author’s own views. It is not a direct basis for investment decisions.

Written: July 2026. Ealexandro