Shipyard Squeeze: Shipping’s $188B Ordering Spree is Overloading Global Capacity
The biggest vessel-ordering program since the eve of the global financial crisis is putting a squeeze on the shipbuilding industry’s capacity to construct new vessels.
South Korean conglomerate Hanwha Group has completed its $100 million acquisition of Philly Shipyard through its subsidiaries Hanwha Systems and Hanwha Ocean, marking a historic moment as the first Korean shipbuilder to establish operations in the United States.
The transaction, which received Committee on Foreign Investment in the United States (CFIUS) approval in September 2024, transforms the shipyard into “Hanwha Philly Shipyard” and signals a new chapter in U.S. shipbuilding.
David Kim, former executive vice president of Hanwha Defense USA, has been appointed CEO to lead the transition. “We plan to grow and build on a long tradition of success, by expanding production using advanced technologies, and supporting the national revitalization of U.S. shipyards,” Kim stated.
Philly Shipyard’s impressive track record includes delivering approximately 50% of all large ocean-going U.S. Jones Act commercial vessels since 2000. The shipyard recently strengthened its market position by completing a second National Security Multi-Mission Vessel for the Maritime Administration.
Hanwha brings significant technological capabilities to the venture, operating one of the world’s largest shipyards in Korea spanning 4.9 million square meters. The company plans to leverage its expertise in naval systems, including unmanned maritime systems and advanced radar technology.
“With Philadelphia’s rich history in shipbuilding, Hanwha is eager to usher in a new era of success,” Kim added, highlighting plans to expand into naval vessel production and increase local employment opportunities.
The deal concludes Aker Capital AS’s two-decade ownership of the shipyard, with Hanwha committing to create new jobs, expand capabilities, and advance workforce development initiatives in the Philadelphia community.
Philly’s orderbook includes five National Security Multi-Mission Vessels for the U.S. Maritime Administration, two of which have already been delivered, and a Subsea Rock Installation Vessel, the Acadia, for Great Lakes Dredge & Dock, and three containerships for Matson, the first of which recently cut steel.
The closing of the acquisition comes as a bipartisan group of lawmakers has introduced the Shipbuilding and Harbor Infrastructure for Prosperity and Security (SHIPS) for America Act, aimed at rebuilding the nation’s declining shipbuilding and commercial maritime industries.
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