Hanwha Ocean edges out HD Hyundai Heavy by 0.5 points in Defense Acquisition Program Administration evaluation
Hanwha Ocean has in effect been chosen as the contractor for the detailed design and lead-ship construction of South Korea's next-generation destroyer, known as the KDDX.
According to the defense industry, the Defense Acquisition Program Administration notified both companies Thursday of their individual evaluation scores for the KDDX detailed design and lead-ship construction contract. The margin between the two firms was approximately 0.5 points.
The preferred negotiating partner will proceed with the detailed design and lead-ship construction of the KDDX after further consultations with DAPA. However, the timeline could be delayed if HD Hyundai Heavy files an objection or seeks an injunction or other legal action.
A key factor in the outcome was a penalty score applied to HD Hyundai Heavy. Nine of its employees were indicted on charges of photographing and leaking KDDX concept design documents from Daewoo Shipbuilding & Marine Engineering — the predecessor of Hanwha Ocean — in 2015. All nine were found guilty: eight in November 2022 and one in December 2023.
DAPA had initially set the penalty period to run through November 2025, but after an internal legal review changed its position, determining that a security deduction of 1.2 points would apply through the end of this year, calculated from December 2023 — when the final guilty verdict was confirmed. HD Hyundai Heavy sought an injunction, but a court rejected the application June 5.
The KDDX project calls for building six domestically developed 6,000-ton Korean Aegis destroyers by 2030 at a cost of approximately 7.8 trillion won (about $5.11 billion). The program proceeds in stages: concept design, basic design, detailed design and lead-ship construction, and follow-on ship construction. While the two companies could ultimately share construction work, the contractor responsible for the detailed design and lead ship dominates the program, making the selection closely watched.
Hanwha Ocean said in a statement that it had received a strong evaluation "based on advanced naval vessel technology and project execution capabilities" in the proposal assessment for the KDDX detailed design and lead-ship construction contract. "If we are ultimately selected as the preferred negotiating partner, we will work closely with DAPA in accordance with project procedures to recover the delayed schedule and mobilize all of our ship design and construction capabilities to ensure no disruption to naval force readiness," the company said.
The company added that it would "do its utmost to achieve world-class performance and quality through flawless systems integration," noting that the KDDX is a domestically built destroyer equipped with nine key indigenously developed systems. "We will dedicate ourselves to the timely fielding of the KDDX as a steadfast partner supporting the strengthening of the Republic of Korea Navy and its advancement toward a blue-water force," it said.
keg@heraldcorp.com
