NATIONAL HARBOR ‚ Md. — HII, the largest naval shipbuilder in the U.S., has signed a wide-ranging agreement with South Korean shipbuilder Hyundai Heavy Industries on Monday that could pave the way for collaboration, to include working on each other’s projects.
The memorandum of understanding between the two companies is broad in its scope, “to explore opportunities to collaborate on accelerating ship production in support of defense and commercial shipbuilding projects,” reads a statement from both HII and Hyundai ahead of the Navy League’s Sea Air and Space symposium.
“We’re open to wherever this relationship can take us, initially focusing on technology exchange and lessons learned, potentially component outsourcing, but open to wherever it can take us,” HII Ingalls president Brian Blanchette told USNI News on Monday.
“We’re building off of the relationship that we have as builders of destroyers, both companies [are] working Aegis destroyers right now. We’re certainly open to exploring everything at a corporate level, beyond just Ingalls. We’ll talk component outsourcing or exploring the opportunities to provide components to destroyers. [Hyundai] has an excellent supply chain. [They have] a lot of lessons learned that they’ve experienced in their production of their destroyer program.”
Ingalls Shipbuilding in Pascagoula, Miss., is one of two yards in the U.S. that are building the Flight III Arleigh Burke guided-missile destroyers and the only yard in the U.S. that builds amphibious warships. Hyundai builds Arleigh Burke variant guided-missile destroyers — the latest hull delivered in November. South Korea is one of the world’s largest shipbuilders with an extensive commercial business in parallel with the naval work.
“This partnership marks a new milestone for both of our companies and provides us with the unique opportunity to expand our expertise in shipbuilding,” Won-ho Joo, head of Hyundai’s naval unit, said in a joint statement.
USNI News understands that the focus of most of the MOU will be between the South Korean shipbuilder and Ingalls, not including the nuclear shipyard at Newport News, Va.
The agreement comes as U.S. naval shipbuilders and repair yards are attempting to hire new workers to meet the demand for naval construction and maintenance with a green workforce. In the Gulf Coast, the competition for talent is fierce with naval yards in Pascagoula and nearby Mobile Ala., all expanding to meet the shipbuilding needs of the Navy and Coast Guard. That work comes on top of the existing oil and gas industry on the Gulf Coast.
HII’s CEO Chris Kastner said last week, due in part to attrition rates, the company was focusing on a more experienced workforce.
“We’re repositioning our hiring programs to hire less entry-level people, get more experienced people, which means you’re going to hire less and you’re going to have to figure out how to get the work done,” Kastner said.
South Korean shipyards have a reputation for efficient industrial processes and have worked with U.S. shipyards in the past to help improve throughput.
Over the last year, U.S. leaders have looked to the Korean shipbuilding industry to do more with naval shipbuilding in the U.S. Former U.S. Secretary of the Navy Carlos Del Toro visited South Korean shipyards, Hanwha Ocean bought Philly Shipyard and Military Sealift Command USNS Wally Schirra (T-AKE-8) recently underwent an availability in South Korea.
