HD Hyundai Accelerates "Jung Ki-sun's Quantum Jump" Strategy with Restructuring of Shipbuilding and Construction Equipment Divisions

Shipbuilding Merger and Construction Equipment Integration: Accelerating Global Network Expansion
Business Portfolio Innovation: A Turning Point for HD Hyundai's Leap Forward

HD Hyundai is accelerating the restructuring of its shipbuilding and construction equipment divisions, as Senior Vice Chairman Jung Ki-sun's "quantum jump" strategy enters full swing. This reorganization, focused on technological innovation and strengthening global competitiveness, is seen not as a simple merger of organizations, but as a strategic move to proactively respond to the transformation of future industries.

HD Hyundai Heavy Industries Yard Panorama. Photo by HD Hyundai

Shipbuilding Division: Strengthening Competitiveness in Special Vessels and Defense

According to industry sources on October 7, HD Hyundai is pursuing a merger between HD Hyundai Heavy Industries and HD Hyundai Mipo Dockyard in the shipbuilding division. The integrated entity is set to launch in December. The key objective is to enhance competitiveness in the naval and special vessel sectors. HD Hyundai Heavy Industries has the highest record for naval shipbuilding in Korea, while HD Hyundai Mipo Dockyard is the world's leading shipyard for medium-sized vessels, with experience in repairing and converting over 8,000 ships.

After the merger, two docks at HD Hyundai Mipo Dockyard will be converted exclusively for special vessels. Together with the existing two docks at HD Hyundai Heavy Industries, a total of four docks will be operated. The company plans to establish a dedicated system for special-purpose vessels such as naval ships and icebreakers, handling the entire process from construction to maintenance, repair, and overhaul (MRO) in-house.

With this restructuring, HD Hyundai has set a goal to achieve 10 trillion won in sales from the shipbuilding and defense sectors by 2035. The British defense journal Janes has projected that the global new naval ship market will reach 2,100 ships and 360 billion dollars over the next ten years. Janes evaluated the merger as "a strategic decision to enhance HD Hyundai's global competitiveness."

Accelerating Expansion of the Global Maritime Network

HD Hyundai will also establish an overseas shipbuilding investment corporation in Singapore. This organization will oversee overseas bases such as HD Hyundai Vietnam Shipbuilding and HD Hyundai Heavy Industries Philippines. It will serve as a hub for discovering new shipyards and managing cooperative projects, aiming to recover lost market share in the commercial ship sector to Chinese competitors and expand overseas order opportunities.

Senior Vice Chairman Jung recently formalized shipbuilding operations at the Subic Shipyard in the Philippines. The company is also pursuing joint projects with the United States, India, and Peru. Through the expansion of the "K-Shipbuilding Global Network," HD Hyundai is implementing entry strategies aligned with the maritime industry policies of each country.

Jung Ki-sun, Senior Vice Chairman of HD Hyundai. Provided by HD Hyundai

Construction Equipment Integration: Advancing to Global Top Tier

A major restructuring is also underway in the construction equipment division. HD Hyundai Construction Equipment and HD Hyundai Infracore will be integrated into a new entity, "HD Construction Equipment," launching in January next year. The merger proposal passed with over 99% approval at the extraordinary general shareholders' meeting in September. ISS, the world's largest proxy advisory firm, also evaluated the merger synergy as "positive."

HD Construction Equipment will streamline its product lineup and strengthen its compact and ultra-large equipment offerings. The company will also expand its electrification, smart equipment, and aftermarket (AM) businesses to diversify its revenue base. Sales of compact equipment are expected to increase from about 9,000 units in 2024 to 22,000 units by 2030. The company also aims to achieve sales of at least 14.8 trillion won in the same year.

Senior Vice Chairman Jung Ki-sun stated, "The global market order is changing rapidly based on technology and partnerships," adding, "The restructuring of the shipbuilding and construction equipment divisions marks the starting point for an innovative reorganization of the group's future portfolio." This restructuring, directly designed by Senior Vice Chairman Jung, is seen as the implementation phase of his mid- to long-term vision and is expected to serve as a turning point for HD Hyundai to advance further in the global market.