Hanwha wins first US warship construction contract, boosting MASGA momentum

Hanwha has become the first South Korean shipbuilder to win a contract to construct a US Navy warship, expanding beyond commercial vessel work in the American market. The award is expected to reinvigorate the Korea-US shipbuilding cooperation project known as MASGA, and is fueling expectations for follow-on orders.

Hanwha Defense USA signed a contract Thursday (local time) with TOTE Services, a vessel construction manager for the US Navy, to build one medium landing ship, or LSM. It marks the first US Navy shipbuilding contract secured since Hanwha acquired the Philadelphia-based Philly Shipyard in December 2024. The deal is valued at approximately $269 million (357.5 billion won), with Hanwha Philly Shipyard carrying out the construction.

Construction is set to begin in the fourth quarter of next year, and the contract is reported to include an option to build up to three additional vessels, potentially bringing Hanwha's total order to four ships. The LSM is an expeditionary landing craft the US Navy is procuring for distributed operations along contested coastlines in the Indo-Pacific and elsewhere. The vessel measures 100 meters in length and 16 meters in width, with a light displacement of approximately 2,687 tons and a range of about 7,400 kilometers. The US Navy is pursuing the LSM based on Dutch shipbuilder Damen's LST-100 design.

TOTE Services was selected as the vessel construction manager for the program in July, securing a $2.2 billion contract, and chose Hanwha following a comprehensive evaluation of safety, quality and delivery track records. Hanwha Philly Shipyard had previously worked with TOTE Services on the US Maritime Administration's National Security Multi-Mission Vessel program, building and delivering four ships. Hanwha Defense USA has also been deploying personnel in Philadelphia since early this year to support the shipyard's preparations for Navy work.

The contract win carries added significance as it comes amid ongoing MASGA cooperation discussions that began last year. South Korea pledged through tariff negotiations to direct $150 billion of a total $350 billion in US investment toward the American shipbuilding sector. While previous work in the US Navy market had been limited to maintenance, repair and overhaul contracts, securing an actual warship construction deal is seen as opening the door to a deeper level of cooperation.

The award also signals that Hanwha Philly Shipyard — Hanwha Group's primary US localization hub — is now recognized as a shipyard capable of building not only commercial vessels but also naval ships. Hanwha acquired Philly Shipyard for approximately $100 million in December last year and has since invested roughly $350 million to modernize its production facilities. In March, Hanwha Philly Shipyard joined Hanwha Defense USA in a concept design project for the US Navy's next-generation logistics support ship, and in July it was selected to build a maritime missile range instrumentation vessel linked to the US "Golden Dome" missile defense system.

As Hanwha Philly Shipyard extends its reach from naval design participation to full construction, expectations are growing for follow-on orders. The US Navy plans to procure a total of 35 LSMs. Hanwha intends to use this contract as a springboard into the US Navy vessel market and will continue investing in workforce development and facility upgrades to pursue additional orders. Michael Coulter, chief executive of Hanwha Defense USA, said the company has made significant investments in personnel and technology since acquiring Philly Shipyard in 2024 to build a foundation for constructing vessels for federal government customers including the US Navy. "We will work with TOTE Services to deliver the ship on schedule and within budget," Coulter added.

The contract also drew a warm reception from local political figures. US Sen. Dave McCormick, a Pennsylvania Republican, said Pennsylvania is leading the revival of American shipbuilding and bringing jobs, manufacturing and new opportunities back to the state. "Hanwha's continued demonstration of investment commitment in Philadelphia shows what can be achieved when you invest in American workers and American industry," McCormick said.