South Korea’s shipbuilding industry is optimistic about expanding its business in the U.S. after U.S. President-elect Donald Trump called for the two countries to strengthen cooperation in the shipbuilding field.
In a phone call with South Korean President Yoon Seok-youl after his election victory last week, Trump said the U.S. would like to cooperate with South Korea in the shipbuilding industry, especially in the ship construction, export, repair and maintenance of warships.
Later, Florida Congressman Mike Waltz, Trump’s White House national security adviser, also pointed out the need to cooperate with the shipbuilding industries of South Korea, Japan and European allies.
According to industry observers, Trump’s and Mike Waltz’s statements reflect the growing concern in the U.S. that its “maritime supremacy could be replaced by China,” especially since China currently dominates global shipbuilding orders.
An industry observer said, “Despite being a military superpower, the U.S. has seen its naval power weaken as a result of a once-booming shipbuilding industry that has long since declined, prompting increasing calls from U.S. political circles to revitalize the country’s shipbuilding industry.”
China has emerged as a global leader in shipbuilding, accounting for 50 percent of the global market share by order book in 2021 and reaching 60 percent in 2023.
The Korean industry expects South Korean shipyards to receive more maintenance, repair and overhaul (MRO) contracts for U.S. warships. Last year, the U.S. Department of Defense earmarked about $13.9 billion in its annual budget for naval MRO services.
HD Hyundai Heavy Industries and Hanwha Ocean have stepped up their efforts to enter the U.S. Navy’s MRO market this year by entering into a ship repair master agreement with the U.S. Naval Supply Systems Command.
In 2022, HD Hyundai Heavy Industries became the first South Korean shipyard to win an MRO contract with the Philippine Navy. Last month, HD Hyundai Heavy Industries signed a joint MRO business agreement with Remontowa Shipyard in Poland.
Hanwha Ocean announced in August this year that it has been awarded the MRO service contract for the US Navy’s 40,000-ton replenishment oiler “Wally Schirra”, marking the first time that a South Korean shipyard has successfully entered the MRO market for U.S. ships. This replenishment oiler belongs to the 7th Fleet of the U.S. Navy.
A few days ago, Hanwha Ocean announced that it had won a maintenance contract for the U.S. Navy’s Seventh Fleet oiler, USNS Yukon. Hanwha Ocean announced the order after Trump said he would “cooperate with the Korean shipbuilding industry,” adding that the new order “marks a new milestone in the U.S.-South Korea maritime defense alliance.”
U.S. Navy officials have been making frequent visits to major Korean shipyards recently, signaling a growing interest in cooperation. In February, U.S. Navy Secretary Carlos Del Toro visited HD Hyundai Heavy Industries and Hanwha Ocean. Last month, Admiral Stephen Koehler, commander of the U.S. Navy’s Pacific Fleet, also visited South Korea to inspect Hanwha Ocean’s repair work on the 40,000-ton replenishment oiler Wally Schirra.
