HD Hyundai-Hanwha Ocean 'Special Ship Conflict' Expands

Hanwha Ocean Holds Briefing at Janggyodong Headquarters on the 5th
Reveals Evidence of Executive Involvement Including Separate Server Operation

On the 4th, Hanwha Ocean submitted a complaint to the National Police Agency's Cyber Bureau regarding the involvement of an HD Hyundai Heavy Industries executive in the leak of military secrets related to KDDX. On the 5th, a press briefing was held at the Seoul headquarters building to address this matter. Hanwha Ocean's legal team lawyer Gu Seung-mo is explaining the progress. Photo by Younghan Heo younghan@

Hanwha Ocean fiercely criticized HD Hyundai Heavy Industries, which filed a complaint against an executive over the leak of concept design information for the Korean next-generation destroyer (KDDX), calling it "an organized and planned criminal act." This came after the Defense Acquisition Program Administration (DAPA) previously decided not to impose bidding restrictions on HD Hyundai Heavy Industries, stating that "no involvement of executives was confirmed," prompting Hanwha Ocean to counter that there was "organized involvement."

On the 5th, Hanwha Ocean held a briefing at its headquarters in Janggyo-dong, Seoul, claiming, "HD Hyundai Heavy Industries operated a separate server through an external contractor, sharing military secrets related to Hanwha Ocean within the company, and attempted to conceal this fact once the investigation began." This explanation followed the filing of a complaint the previous day requesting punishment related to the KDDX project information leak.

Employees of HD Hyundai Heavy Industries were found guilty last November of secretly acquiring military secrets related to KDDX and other projects and sharing them through the company's internal network, violating the Military Secrets Protection Act. Subsequently, DAPA reviewed the restriction of HD Hyundai Heavy Industries' participation in defense project bids but decided not to restrict participation, stating, "There is no objective evidence confirming the involvement of representatives or executives, which would constitute a breach of the integrity pledge."

Hanwha Ocean emphasized, "Evidence of (organized acts) can be confirmed through related court rulings and criminal case records," adding, "Since operating the server requires a budget, it is a circumstance that HD Hyundai Heavy Industries executives could not have been unaware of." They further stated, "It is unreasonable that only nine employees were punished for company-level criminal acts," and explained, "We proceeded with the police complaint because appropriate follow-up measures corresponding to the illegal acts are necessary to prevent recurrence of the same behavior."

HD Hyundai Heavy Industries also responded to the rebuttal. A company official said, "(Hanwha Ocean's claims) are incomprehensible and groundless," and asserted, "This matter has already been concluded through court rulings and two in-depth reviews by DAPA."

The conflict between the two companies stems from their high stakes in the special-purpose ship business. As global demand for eco-friendly vessels increases, two to three years' worth of orders have accumulated at commercial shipyards. Attention is turning to the special-purpose ship sector. With escalating geopolitical crises worldwide, demand for special-purpose ships such as warships and submarines has significantly increased, and the trend toward unmanned vessels is greatly enhancing added value. Countries like Canada, Poland, and the Philippines are planning submarine tenders. In this context, winning the KDDX project can serve as a reference (order record) for future global warship market entry.

With the initial KDDX destroyer construction bid scheduled for the end of this year, the global combat ship market size for the next decade for both companies is expected to reach $986 billion (approximately 1,320 trillion KRW). The warship and submarine sectors targeted by both companies alone amount to $243 billion (approximately 325 trillion KRW). Hanwha Ocean aims to make this year a leap forward in defense sales, targeting 1 trillion KRW in revenue. By the 2030s, it plans to achieve over 3 trillion KRW in defense sales. HD Hyundai Heavy Industries has also set its special-purpose ship (warship) business order target, including surface ships and submarines, at $988 million (approximately 1.3158 trillion KRW), more than seven times last year's order record of $138 million.

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