'Security Point Deduction' Decides KDDX Outcome... HD Hyundai Heavy Industries Appeals Injunction Dismissal

Final Evaluation Overturned by 1.2-Point Security Deduction
Appeal Filed Against Court's Dismissal, Emerging as Key Factor in Contractor Selection

HD Hyundai Heavy Industries has filed an appeal regarding the security penalty deduction that determined the outcome of the 'Korean Next-Generation Destroyer (KDDX)' project.

An aerial view of HD Hyundai Heavy Industries' Korean next-generation destroyer (KDDX). HD Hyundai Heavy Industries

According to industry sources on June 12, HD Hyundai Heavy Industries submitted a notice of appeal to the Seoul Central District Court the previous day, challenging the decision to dismiss its request for an injunction against the extension of the security penalty deduction.

Previously, the Defense Acquisition Program Administration extended the security penalty deduction measure, imposed due to a past military secret leak incident, until the end of this year. In response, HD Hyundai Heavy Industries filed for an injunction to halt the application of the penalty, but the court dismissed the request on June 5.

As a result of the court's decision, HD Hyundai Heavy Industries received a 1.2-point security penalty deduction in the evaluation of proposals for the detailed design and construction of the lead ship for the KDDX project.

Industry insiders believe that this penalty deduction was effectively the decisive factor in the selection of the contractor. It is reported that HD Hyundai Heavy Industries scored approximately 0.6 points higher than Hanwha Ocean in the technical evaluation, but after the security penalty was applied, Hanwha Ocean ultimately led by about 0.6 points in the final score.

If HD Hyundai Heavy Industries' appeal is accepted, it is expected to have a significant impact on the direction of the KDDX project. The Defense Acquisition Program Administration plans to select a preferred negotiation partner as early as the beginning of next month through subsequent procedures and aims to sign a contract within the same month.

This content was produced with the assistance of AI translation services.