Power Solutions International has agreed to a two-year supply arrangement with HD Construction Equipment Co. for 22-liter natural-gas engine components used in its power systems. The deal sets prices and delivery schedules for 2027 and 2028, giving PSI greater visibility over a key input as it serves demand for stationary power, including from data centers and other critical infrastructure.
The scheduled engine purchases represent about $121.9 million at the agreed prices. The arrangement also requires PSI to pay advances before receiving the related engines.
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Prices and deliveries: The price for HCE’s GV22TI engine long blocks is fixed for engines ordered and shipped by Dec. 31, 2028. It cannot be increased unless both companies agree in writing. A monthly delivery schedule covers the 2027 and 2028 volumes.
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Advance payments: PSI will pay an advance equal to 10% of each year’s scheduled volume. The 2027 advance is due by Nov. 30, 2026, and the 2028 advance by June 30, 2027. HCE will repay each advance through a 10% reduction in invoices for products shipped during the applicable year.
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If purchases fall short: If PSI’s actual purchases over the two-year period are less than 90% of scheduled volume, the companies will discuss a recovery mechanism. That could include a price increase in 2029. The parties may also agree on reasonable measures if deliveries are delayed or volumes temporarily reduced.
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Supplier relationship: The amendment confirms HCE’s succession to the supply agreement, effective Jan. 1, 2026. PSI has sourced engines through HCE and its predecessors since 2007. Other terms of the existing supply agreement remain in effect.
The arrangement gives PSI agreed pricing and a scheduled supply of engines, while requiring it to commit cash in advance. PSI has also identified its dependence on HCE, possible delivery delays and the timing of advance payments relative to customer deposits as risks.