Artist’s rendering of the U.S. Navy’s planned Medium Landing Ship (LSM), designed to transport Marines, equipment and supplies in support of expeditionary operations. (Image: U.S. Navy)
Hanwha Philly Shipyard has secured a $269 million contract to build a Medium Landing Ship (LSM) for the U.S. Navy and Marine Corps, marking a major milestone in the South Korean company’s push into U.S. naval shipbuilding.
TOTE Services announced Friday that it selected Hanwha Defense USA (HDUSA) as the first shipbuilder under its $2.2 billion Vessel Construction Manager (VCM) contract for the LSM program. The award covers construction of one vessel at the Philadelphia shipyard, with options for three additional ships.
Construction is expected to begin in the fourth quarter of 2027, with the program’s first vessel scheduled for delivery in 2030.
The selection follows a competitive bidding process launched in July and comes just days after Hanwha announced plans to place its Philadelphia shipyard under the control of its U.S. defense subsidiary.
“Since acquiring Philly Shipyard in 2024, Hanwha has made significant investments in its workforce and technology to pave the way to build ships for the U.S. Navy and other federal customers,” said HDUSA President and CEO Michael Coulter.
The contract represents Hanwha Defense USA’s first U.S. Navy shipbuilding award and a significant step in the company’s effort to transform the former commercial shipyard into a dual-use facility serving both military and commercial customers.
TOTE Services said Hanwha was selected based on its competitive pricing and acceptance of subcontract terms and conditions. The company is also continuing contract discussions with Bollinger Shipyards and Fincantieri Marinette Marine, which are expected to participate in construction of the LSM fleet.
“This award shows the speed at which the VCM model can move from RFP to contract,” said TOTE Services President Jeff Dixon. “Through a competitive process, we secured strong terms that benefit the government, along with build positions that allow construction to start in the fourth quarter of 2027.”
The LSM program is intended to provide the Marine Corps with smaller amphibious vessels capable of transporting personnel, equipment and supplies between islands and coastal locations, particularly in the Indo-Pacific. The Navy and Marine Corps are planning a fleet of 35 vessels, with TOTE’s initial contract covering up to eight ships.
The award also builds on an existing relationship between TOTE Services and the Philadelphia yard.
Under a separate VCM arrangement with the U.S. Maritime Administration, TOTE has overseen construction of the National Security Multi-Mission Vessel (NSMV) program at Philly Shipyard. Four of the five training ships have already been delivered.
“Hanwha Philly Shipyard has already built and delivered four National Security Multi-Mission Vessels under the VCM model with TOTE Services, and we will leverage that experience to deliver the LSM to the U.S. Navy and Marine Corps,” said Tim Glinatsis, senior vice president of program management at HDUSA.
The announcement comes amid a broader restructuring of Hanwha’s U.S. shipbuilding operations.
As gCaptain recently reported, Hanwha Defense USA announced this week that it is acquiring a controlling stake in Hanwha Philly Shipyard, shifting the facility toward defense-led ownership as the company expands its U.S. naval shipbuilding business.
Hanwha acquired the shipyard in December 2024 and has since been investing in workforce development, infrastructure and technology to support an expansion into naval construction.
The shift has also raised questions about the future balance between military and commercial shipbuilding at one of the country’s major Jones Act shipyards.
Asked by gCaptain whether Hanwha would maintain and expand commercial Jones Act shipbuilding capacity as the yard transitions toward defense-led ownership, a company spokesperson said it was “in a good position to compete and build for commercial and naval demand as a dual-use yard.”
Friday’s contract announcement provides the clearest indication yet of how Hanwha intends to put that strategy into practice, establishing a foothold in Navy ship construction while positioning the Philadelphia facility to compete for additional government and commercial work.
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