Hanwha Ocean to Build KDDX After All

Defense Acquisition Program Administration Selects Preferred Negotiating Partner
for Detailed Design and Lead Ship Construction

Hanwha Ocean announced on the 1st that it has been selected as the preferred negotiation partner for the detailed design and construction of the lead ship in the Korean Destroyer Next Generation (KDDX) project, which was commissioned by the Defense Acquisition Program Administration. Hanwha Ocean explained that the contract amount and period will be finalized following negotiations between the parties.

The company added that it plans to sign the final contract after negotiating specific transaction terms, and that it will make an additional public disclosure when the contract terms are finalized.

On June 11, the Defense Acquisition Program Administration notified that Hanwha Ocean had outperformed HD Hyundai Heavy Industries in the evaluation of proposals submitted for the KDDX project. It is reported that Hanwha Ocean led by a narrow margin of approximately 0.59 points.

The outcome was determined by a 1.2-point security penalty imposed on HD Hyundai Heavy Industries. The company became subject to this penalty after employees were found guilty of photographing and leaking military secrets, including conceptual designs related to the KDDX project. In response to the evaluation results, HD Hyundai Heavy Industries filed an objection, but the Defense Acquisition Program Administration dismissed it the previous day.

KDDX is a project to build six 7,000-ton-class "mini Aegis destroyers" using domestic technology, with a budget of 7.8 trillion won. The lead ship is expected to be delivered to the Navy at the end of 2032 after the detailed design is completed.

Originally, detailed design and lead ship construction were scheduled to begin in 2024, after completion of the basic design in December 2023. However, the project was delayed by about two years due to intensified competition between the two companies, which left the Defense Acquisition Program Administration unable to reach a decision. With the selection of the preferred negotiation partner, the long-standing controversy over excessive competition and the two-year delay in the KDDX contractor selection process have reached their final stage. There is speculation that the two companies might split the construction of the six ships due to capacity issues, but the company responsible for building the lead ship will effectively hold the initiative.

It is known that the Defense Acquisition Program Administration plans to begin commissioning the remaining five follow-up ships at the end of 2028 after finalizing the detailed design, with the goal of delivering all follow-up ships to the Navy by 2036.

An official from the Defense Acquisition Program Administration stated, "We will continue to pursue the project fairly and in accordance with relevant laws and regulations, and will do our utmost to ensure there are no delays in the force integration schedule."

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