Hanwha Aerospace Reviews Feasibility of U.S. Production from Ammunition Raw Materials to Finished Products

Initiating Local Production Processes
One Trillion Won U.S. Investment in Ammunition Business Takes Shape
Focus Shifts from Equity Investment to Direct Production
Significance of Establishing the Entire Value Chain Overseas
Plans Underway to Establish a North American Defense Corporation

Hanwha Aerospace has begun a feasibility study on establishing military ammunition production processes in the United States. Previously, the company had included the "ammunition business" in its investment plans for the U.S., and it now appears to be focusing more on direct production rather than local equity investment. If Hanwha builds a factory in the United States, it would mark the first case of a domestic defense company establishing the entire value chain overseas, from the production of raw materials for ammunition to final supply.

According to industry sources on May 9, Hanwha Aerospace is reviewing a plan to establish the entire ammunition value chain in the United States, including the high-risk basic explosive material nitroglycerin. Nitroglycerin is a highly dangerous and explosive chemical used as a key ingredient in ammunition propellants and charges.

Hanwha does not produce finished ammunition in Korea, but it is reported that the company intends to establish an integrated production system in the United States, covering everything from raw materials to finished products. A Hanwha Aerospace representative stated, "The production entity, method, and site have not yet been decided," adding, "We are currently reviewing the entire value chain."

Earlier, at a press briefing in early April, Ahn Byungcheol, Chief Strategy Officer of Hanwha Aerospace, revealed, "The one trillion won investment plan for the United States includes the ammunition business." The feasibility study is interpreted as a move to concretize the process for local production in the U.S.

The land-based defense sector, which includes ammunition, is the largest business segment for Hanwha Aerospace. Last year, it recorded sales of 7.0056 trillion won, accounting for 62.3% of the company's total revenue. As the central pillar and core profit source of the group's defense business, the strategic importance of the ammunition value chain is also increasing.

Alongside its review of U.S. investments, Hanwha Group is also working on establishing a defense corporation in North America called "Hanwha Global Defense." Through this entity, the group plans to oversee Hanwha Aerospace, Hanwha Ocean, and Hanwha Systems, the three main defense companies. A company representative described Hanwha Global Defense as "a base corporation for global strategy development and partnership building."

If Hanwha Aerospace's plan materializes, it will be the first time a domestic defense company localizes the production of ammunition overseas. Hanwha currently produces ammunition raw materials at its domestic sites in Changwon, Yeosu, Boeun, Daejeon, and Hwasun.

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