HD Hyundai and Hanwha Take Their Shipbuilding Rivalry to US Yards
A 13 August memorandum eases the bar on building US Navy ships overseas, for yards that buy into a US shipyard
The rivalry between HD Hyundai and Hanwha Ocean has moved across the Pacific, with both South Korean groups now competing for entry into the United States naval shipbuilding market.
The contest has been sharpened by a policy shift in Washington. On 13 August, a presidential memorandum opened the possibility of allowing foreign shipbuilders to construct the first two vessels of certain US naval programmes in their home countries, provided they simultaneously build a new American shipyard or acquire a majority stake in an existing one. That eases a longstanding restriction on building navy ships overseas and removes a central barrier to Seoul's participation, under an initiative through which South Korea has committed $150bn to the US shipbuilding sector.
Hanwha holds the early lead, and the asset HD Hyundai lacks. Hanwha Ocean and Hanwha Systems acquired Philadelphia-based Philly Shipyard for $100m in December 2024, making the group the first Korean shipbuilder to own a major US yard. The facility had been limited in recent years to one or two vessels annually across two docks; a $5bn infrastructure programme announced last year is intended to lift that towards 20 ships a year and extend the yard from commercial work into LNG carriers, naval modules and eventually naval vessels.
That investment has begun to return work. In March, Hanwha Defense USA and Hanwha Philly Shipyard won a first US Navy-related project as subcontractors on concept design for the Next Generation Logistics Ship programme, alongside Vard Marine US. In June the yard secured a contract for two Missile Range Instrumentation Vessels for the Missile Defense Agency. Earlier in August, Hanwha Defense USA proposed acquiring the US arm of Australia's Austal for between $1.05bn and $1.2bn. Based in Mobile, Alabama, Austal USA builds for both the US Navy and the Coast Guard.
HD Hyundai has taken the slower route, favouring technology partnerships and repair work: a tie-up with Huntington Ingalls Industries to co-build the navy's next fleet auxiliary ships, and a July memorandum with Fraser Industries on yard modernisation. That stance appears to be changing. HD Korea Shipbuilding & Offshore Engineering established HD Hyundai USA LLC in May with 3.67bn won ($2.67m), and has been examining multiple yards, including facilities in San Diego and along the Texas Gulf Coast, both close to navy hubs and established supply chains.
"It is true that we are looking at multiple shipyards," an HD Hyundai official said, adding that nothing had been finalised and that the company was not close to signing a deal. Chair Chung Ki-sun had already left the door open to a US acquisition in October 2025. Whichever way that decision falls, the newbuilding capacity being contested is naval rather than commercial.
