A shipbuilding industry official explained the busy situation in the shipbuilding industry as they prepare business proposals to participate in the Korea-US shipbuilding cooperation project ‘MASGA (Make American Shipbuilding Great Again)’. It is known that in addition to the industry ‘Big 3’ – HD Hyundai Heavy Industries, Samsung Heavy Industries, and Hanwha Ocean – small and medium-sized shipbuilders will also submit business proposals.

According to the industry on Nov. 23, the shipbuilding Big 3 – HD Hyundai, Samsung Heavy Industries, and Hanwha – have already submitted business proposals to the US Department of Commerce. In addition, multiple small and medium-sized shipbuilders are scheduled to complete submission of their business proposals by next week. The companies’ business proposals are known to include US business plans, investment scale, and talent development measures.
HD Hyundai’s strength lies in its track record of building over 100 naval surface ships and submarines for Korea, the Philippines, New Zealand, Peru, and other countries. Based on this, the company demonstrated strong commitment to MASGA participation by establishing strategic partnerships with US defense shipbuilder Huntington Ingalls in the warship sector in April and with Edison Chouest Offshore in the commercial vessel sector in June.

In particular, it recently signed a ‘Memorandum of Agreement (MOA) on Commercial and Military Vessel Design and Construction Cooperation’ with Huntington Ingalls. As the first cooperation case between Korea and the US in the military support vessel sector, the two companies are targeting bids for conceptual design of the US Navy’s next-generation military support vessels based on jointly developed military support ships.

Samsung Heavy Industries is also expanding its MASGA footprint by signing a ‘Strategic Partnership Agreement (MOU)’ with DSEC, a company specializing in ship design and equipment procurement. Prior to this, it fired the starting signal for MASGA participation by establishing a strategic partnership with US-based Vigor Marine Group. Vigor Marine Group is a US shipbuilder specializing in naval vessel maintenance and modernization, and maintenance, repair, and overhaul (MRO) of special mission vessels.

Hanwha emerged as a key ‘MASGA’ partner in name and reality by acquiring the Philly Shipyard located in Philadelphia, US, in December last year. Hanwha Ocean plans to invest approximately $5 billion (approximately 7 trillion won) to expand Philly Shipyard’s shipbuilding capacity to 20 vessels annually. The current annual production capacity of Philly Shipyard is 1 to 1.5 vessels. Hanwha Ocean plans to lead the MASGA project through large-scale infrastructure expansion including securing two additional docks and three additional berths, and establishing a new block production base of approximately 396,694㎡.

Beyond the K-shipbuilding Big 3, small and medium-sized shipbuilders are also busy preparing business proposals. With domestic medium-sized shipbuilders’ order volume in the first half of this year plummeting 72.0% compared to the same period last year, the strategy is to use the MASGA project as a growth momentum. Expectations for participation by numerous small and medium-sized shipyards are particularly rising, given that the commercial vessels needed by the US in cooperation have an overwhelmingly higher proportion of small and medium-sized vessels than large ones, and naval warships are also of a size that can be built in medium-sized docks.
Source: Business Korea