HII, HD Hyundai Heavy Industries look to collaborate on ship production under new MOU

NATIONAL HARBOR, MD -- United States shipbuilder HII have signed a memorandum of understanding with South Korean shipbuilder HD Hyundai Heavy Industries to "explore opportunities to collaborate on accelerating ship production" for both defense and commercial work, the companies announced today.

Signed by executives from the two companies this morning during the Navy League's Sea-Air-Space conference, the MOU is the latest indication of increased collaboration between the U.S. and South Korean shipbuilding industries.

It connects HII -- a U.S. shipbuilding giant involved in the production of most of the Navy’s surface and undersea fleet including its nuclear-powered aircraft carriers and both the Columbia- and Virginia-class submarine programs -- with one of the largest shipbuilders in the world in HD Hyundai Heavy Industries (HHI).

The initial focus of the partnership will be an exchange of technologies and lessons learned, with the potential for “component outsourcing” to follow, HII Executive Vice President and President of Ingalls Shipbuilding Brian Blanchette told reporters following the signing. HII will soon host a delegation from HHI at its U.S. facilities, Blanchette said.

“Today’s agreement reflects our commitment to explore all opportunities to expand U.S. shipbuilding capacity in support of national security,” Blanchette said. “By working with our shipbuilding allies and sharing best practices, we believe this MOU offers real potential to help accelerate delivery of quality ships.”

The partnership is intended to “leverage the combined expertise and resources of both companies to advance technological innovation, maximize production efficiency, and strengthen the global defense industry,” according to an HII press release.

“This partnership marks a new milestone for both of our companies and provides us with the unique opportunity to expand our expertise in shipbuilding,” said Won-ho Joo, chief executive of HHI’s naval and special ship business unit. “We look forward to working with HII to explore new possibilities and deliver even greater value to our customers.”

As the U.S. shipbuilding industry looks for ways to boost ship and submarine output, the Navy has encouraged South Korean and other international shipbuilders to invest in U.S. industry, with former Navy Secretary Carlos Del Toro saying a “cash infusion” from foreign companies could improve production capacity.

Last summer, South Korean defense conglomerate Hanwha purchased Philadelphia-based Philly Shipyard where it plans to take on ship and submarine module fabrication work.