Hanwha Ocean: "KDDX Should Also Undergo Detailed Design Competitive Bidding Like the Sea Trial Ship"

"Measures Prioritizing National Interest"

Hanwha Ocean argued on the 30th that "if the Korean next-generation destroyer (hereinafter KDDX) detailed design contractor is also selected through competitive bidding, better projects can be expected for the national interest," in relation to the Defense Acquisition Program Administration (ADD) breaking the existing precedent by conducting competitive bidding for both the basic and detailed design of the large maritime test platform for guided missile launchers.

The Defense Acquisition Program Administration announced on the 26th through the Public Procurement Service's Nara Market that HD Hyundai Heavy Industries was selected as the contractor for the detailed design and shipbuilding of the large test ship. Hanwha Ocean was responsible for the basic design of the large maritime test ship.

Hanwha Ocean stated, "While the Defense Acquisition Program Administration requested participation from Hanwha Ocean, HD Hyundai Heavy Industries, and HJ Heavy Industries for the large test ship basic design project, the two companies except Hanwha Ocean declined to participate due to design difficulties according to the required performance of the large test ship and the low cost."

They continued, "The project budget was small compared to the design difficulty according to the required performance such as support for next-generation guided missile development tests. However, Hanwha Ocean, with a sense of duty as a naval defense contractor prioritizing national security and public safety, participated alone in the basic design project and successfully completed the basic design project in August last year."

After completing the basic design, the Defense Acquisition Program Administration reportedly requested additional proposals for five improvement items in the request for proposal. This request was made in the form of an open proposal to all other shipbuilders.

Hanwha Ocean Geoje Plant View [Photo by Hanwha Ocean]

Hanwha Ocean said, "The recent claim by HD Hyundai Heavy Industries through the media that 'although Hanwha Ocean carried out the basic design, it did not meet the improvement performance required by the Defense Acquisition Program Administration, so HD Hyundai Heavy Industries conducted an additional review of the basic design results and participated in this bidding at the request of the ordering agency, proceeding through competitive bidding' does not align chronologically."

They added, "Similarly, for the KDDX project, as HD Hyundai Heavy Industries claimed in winning the large test ship project, additional improvement items are expected to come out from the Defense Acquisition Program Administration regarding the basic design. If the detailed design and lead ship contractor are selected through competitive bidding reflecting these improvements, a better KDDX project can be expected."

Earlier, after completing the basic design, Hanwha Ocean, which performed the basic design, agreed to competitive bidding without insisting on a sole-source contract, in response to the Defense Acquisition Program Administration's explanation that "competitive bidding is the principle" during project preparation. This explanation contrasts with the Defense Acquisition Program Administration's previous stance that "unless there are special reasons, the company that performed the basic design proceeds with the detailed design and construction project through a sole-source contract."

Hanwha Ocean said, "The fact that the large test ship detailed design and shipbuilding contractor selection was conducted through competitive bidding is significant as it shows that 'our country's top defense research institute, the Defense Acquisition Program Administration, considers it fully possible to separate the basic design, detailed design, and shipbuilding in naval projects and proceed accordingly.'"

On May 28, HD Hyundai Heavy Industries stated at the 'K-Ship R&D and Vision Briefing' in materials titled "This is the KDDX project R&D" that "if a company that did not participate in the R&D project suddenly jumps into the KDDX detailed design and lead ship construction project, the project period and costs will increase, making it impossible to meet the operational deployment schedule, and the project itself is likely to fail, wasting the public's money." Regarding this, Hanwha Ocean said, "Although HD Hyundai Heavy Industries has always emphasized the importance of basic design and made such claims, their explanation after winning the large test ship project that they will meet the improved performance and deliver early contradicts their previous assertions."

Hanwha Ocean stated, "Contrary to HD Hyundai Heavy Industries' claim that the company performing the basic design must also handle the lead ship construction, Hanwha Ocean can proceed with the project without disruption by receiving the basic design result data held by the Defense Acquisition Program Administration. We emphasize once again that selecting the KDDX detailed design and lead ship construction contractor through fair competitive bidding is the best way to prioritize the national interest." The KDDX project is a Defense Acquisition Program Administration initiative to operationalize six Korean Aegis destroyers by 2036, with a budget of 7.8 trillion won.

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