Hanwha Aerospace selected as sole prototype maker for US self-propelled howitzer modernization program

Hanwha Aerospace has been selected as the sole prototype manufacturer for the US Army's self-propelled howitzer modernization program, a contract worth up to 10 trillion won ($7.07 billion) — marking the first time a South Korean company has exported a finished weapons system to the world's largest defense market.

The US Army announced Tuesday that it had chosen Hanwha Defense USA, the American subsidiary of Hanwha Aerospace, to lead the program.

Under the contract, the Army will receive up to 18 prototypes and conduct performance trials over approximately four years. The prototype development contract is valued at $262.9 million. If the system passes those trials, the Army is expected to sign a follow-on production deal with Hanwha Defense USA worth up to 10 trillion won.

The modernization program aims to replace the towed M777 howitzer and the M109A7 tracked self-propelled howitzer, which entered service in the 1960s. Hanwha competed against a field of global defense contractors, including Germany's Rheinmetall, Britain's BAE Systems and Italy's Leonardo DRS.

Hanwha put forward the K9MH to beat out its rivals. The K9MH combines a wheeled platform with a fully automated turret, built on the foundation of the K9 self-propelled howitzer.

Analysts say Hanwha's localization strategy proved decisive. In April, Hanwha Defense USA leased an idle factory in Opelika, Alabama, for three years and committed roughly $2 million to build a K9MH integration and testing facility there.

The K9's combat-proven performance in Europe and the Middle East is also expected to have weighed in Hanwha's favor. The K9 howitzer has been exported to 10 countries, including Poland, Norway, Turkey and Vietnam, and holds the top market share in the global self-propelled howitzer segment. The system is noted for its rapid displacement after firing, as well as its mobility and survivability.

The win carries broader strategic significance as the first time a finished weapons system made by a South Korean company has entered the US market. Because the United States is a NATO member, the deal also opens a path for Hanwha to pursue exports of strategic assets to other NATO countries.

The result stands in contrast to the fortunes of Hanwha's defense affiliate Hanwha Ocean, which last month lost a bid for Canada's next-generation submarine program — valued at 60 trillion won — to Germany's TKMS. Analysts noted at the time that Germany's status as a fellow NATO member had worked against Hanwha Ocean in that competition. With the US howitzer win now in hand, however, Hanwha is positioned to accelerate its push into NATO-member markets.