Nuclear-Powered Submarines Propel the Rise of the Advanced Technology Industry

Samjong KPMG Releases Report
Project to Establish a Convergent Industrial Ecosystem
Positive Impact on Materials and Software as well as Shipbuilding and Defense

There are expectations that the Korean nuclear-powered submarine project will have a positive impact not only on directly related industries such as defense and shipbuilding, but also on the growth of advanced technology industries, including materials and software.

On April 15, Samjong KPMG Economic Research Institute stated in its recently published report, "Deep Dive into K-Shipbuilding: Nuclear-Powered Submarines," that "the nuclear-powered submarine construction project is anticipated to establish a convergent industrial ecosystem encompassing defense, nuclear power, shipbuilding, electric power, and materials, among others."

A nuclear-powered submarine is a vessel that uses nuclear fuel for propulsion and operation. It generates energy by driving turbines using thermal energy produced by nuclear fission within a reactor, resulting in low noise and convenient energy supply. Therefore, it outperforms conventional diesel-powered submarines in long-term submersion, high-speed navigation, and securing an onboard oxygen supply. Superior construction technology and a wide range of capabilities are required to build such submarines. In reality, the six countries operating nuclear-powered submarines (the United States, China, Russia, the United Kingdom, France, and India) possess all necessary capabilities, including nuclear fuel production, ship construction, and the equipping of nuclear weapons.

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"Industry-wide Impact...Technological Innovation Will Occur"

The institute analyzed the nuclear-powered submarine construction project not only from a military security perspective, but also in terms of its economic and industrial implications. It especially emphasized that the project presents growth opportunities for companies engaged in advanced technology industries. In the defense sector, which is directly related, demand is expected to increase for software platforms that support detection systems, torpedo and weapons management, and the operation of tactical navigation or combat systems. In the shipbuilding industry, demand is expected to rise for the design and construction technology of hulls and compartment structures suitable for deep-sea and ocean-going navigation, as well as for maintenance, repair, and overhaul (MRO) services. Additionally, it was analyzed that the project will influence the development of the nuclear power industry, such as small modular reactors (SMRs) for military use and radioactive safety management.

The institute also forecasted that technological spin-offs between defense and civilian industries will expand. As military technologies such as high-output power systems and SMR technology are transferred to the private sector, there is potential for the industrial scope to broaden into areas such as the energy industry, offshore plants, smart manufacturing, and eco-friendly ships.

Hanwha Ocean and HD Korea Shipbuilding & Offshore Engineering Equipped with Technology and Infrastructure

The institute suggested that building dedicated infrastructure is necessary to produce nuclear-powered submarines. In particular, essential elements include: docks and construction equipment capable of accommodating large hulls; advanced security and construction line control systems; the establishment of radiation control zones; and the securing of nuclear-related specialized personnel. Securing technological capabilities was also highlighted as important. Examples of advanced design include onboard reactor installation, securing enriched uranium, and noise reduction technology within the submarine.

The institute identified Hanwha Ocean and HD Korea Shipbuilding & Offshore Engineering as core companies for the project. Hanwha Ocean has outstanding performance in construction technology, recording the highest number of submarine builds among domestic shipbuilders and leading the country's first fully self-designed and constructed submarine project. Recently, the acquisition of the U.S. Philadelphia Shipyard has further strengthened its connections with the American shipbuilding industry. HD Korea Shipbuilding & Offshore Engineering, on the other hand, owns the Ulsan shipyard, the world's largest in terms of a single shipyard. Last year, it signed a joint development agreement for the next-generation Peru-type submarine and has been achieving results in submarine-related business.

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