Hanwha Philly Shipyard has won a $269 million contract to build a Medium Landing Ship for the U.S. Navy and Marine Corps, marking the first time in roughly three decades that a Navy vessel will be constructed on Philadelphia's waterfront. The award, which also carries options for three additional ships, lands days before the shipyard's new president takes office, as it prepares for a major expansion.
TOTE Services, which partners with the shipyard on the program, announced on October 30 that Hanwha Defense USA was its first shipyard selection for the Medium Landing Ship, or LSM, program. The contract covers construction of one vessel valued at $269 million at Hanwha Philly Shipyard, with options for three more, according to TOTE's announcement. TOTE describes the program as a way to give American shipyards, suppliers, manufacturers and skilled trades a more reliable demand signal, and its $2.2 billion Vessel Construction Manager contract supports the Navy and Marine Corps' planned 35-ship LSM fleet.
Construction is positioned to start in the fourth quarter of 2027, with the program's first vessel expected in 2030, per TOTE's release. A Hanwha spokesperson told The Philadelphia Inquirer that work on the ship is expected to begin by 2028, consistent with TOTE's projected start. Other yards are already moving on similar Navy work: Bollinger Shipyards in Louisiana is already under contract to build the first LSM, and Fincantieri Marinette Marine in Wisconsin won a contract earlier this year for long-lead items on four ships, according to USNI News.
A Return to Warship Building After Decades
The contract marks the first Navy vessel to be built in Philadelphia since the former Philadelphia Naval Shipyard ceased operations in 1995, the station's report notes. That shipyard built and repaired Navy vessels for generations before closing in the mid-1990s, and the current commercial yard has since built ships for private operators rather than the military. This deal returns Navy shipbuilding to the Philadelphia waterfront for the first time in three decades.
Hanwha Defense USA holds a majority stake in Hanwha Philly Shipyard, a stake that allows the yard to build both commercial and military ships. Hanwha acquired the shipyard in 2024 through a $100 million investment, per the same account. In September, Hanwha agreed to lease 47 additional acres at the Navy Yard and began work on new facilities, including an additional dry dock.
New President Takes Over Amid Expansion Push
Hyuk Kim became president of Hanwha Philly Shipyard effective November 2, succeeding David Kim, who had nearly doubled the shipyard's workforce during his tenure. Kim brings more than 25 years of experience in commercial and naval shipbuilding, according to Yonhap News Agency. He described the facility as a cornerstone of Hanwha's commitment to revitalizing American shipbuilding, per PHILADELPHIA.Today's reporting on the leadership change.
Kim said the shipyard would focus on strengthening operational excellence, expanding shipbuilding capacity, and developing the workforce needed to support both commercial and naval programs, according to Yonhap. That mission dovetails with a $5 billion infrastructure plan Hanwha announced for the Philadelphia site, which the company says is part of South Korea's broader commitment to U.S. shipbuilding growth.
Betting Big on Faster Production
Hanwha's $5 billion plan is dedicated to installing two additional docks and three quays, with a possible new block assembly facility, according to Hanwha. The company says the investment aims to lift annual production from fewer than two vessels to as many as 20. Locally reported figures tied to the expansion put the potential job impact at up to 10,000 positions.
The shipyard currently produces about one ship every eight months and wants to boost that pace to one every few weeks, the Inquirer reported. The Navy's long-range shipbuilding plan has set a goal of performing 50 percent of shipbuilding work at distributed sites, up from roughly 10 percent today, according to the same USNI News report.
