Exclusive: South Korea and U.S. Explore Naval Shipbuilding Cooperation to Strengthen U.S. Naval Force Capabilities.

U.S. Secretary of the Navy John C. Phelan’s visit to South Korean Hanwha Ocean’s Geoje Shipyard on April 30, 2025, comes at a pivotal moment for U.S. maritime strategy. As the United States confronts a critical shortfall in naval shipbuilding capacity and faces mounting security challenges across the Indo-Pacific, Washington is turning to trusted allies like South Korea to not only supplement its industrial limitations but to forge a new path for maritime dominance.
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The U.S. Navy’s USNS Yukon, currently undergoing repair at Hanwha Ocean’s Geoje Shipyard under a U.S. Navy maintenance contract. (Picture source: U.S. DoD)

The visit follows a sobering announcement by the U.S. Government on April 9, 2025, which declared that the country’s commercial shipbuilding capabilities had deteriorated after decades of federal neglect. This decline has significantly weakened the United States’ maritime industrial base (MIB), leaving the nation vulnerable at a time when naval power is more essential than ever. The figures are stark: the U.S. now produces less than 1% of commercial ships globally, while China accounts for approximately 50%. This industrial disparity is not just economic—it is strategic. Maritime superiority is the cornerstone of force projection, sea control, and deterrence. Without the capacity to build and maintain a modern fleet, the U.S. risks ceding influence to adversaries in key maritime theaters.

In this context, Secretary Phelan’s discussions with Hanwha Group Vice Chairman Dong Kwan Kim centered on how to bridge these industrial gaps through enhanced bilateral cooperation. The Geoje Shipyard, where the visit took place, is a flagship facility in South Korea’s globally respected shipbuilding sector. The highlight of the tour was the U.S. Navy’s USNS Yukon, currently undergoing Maintenance, Repair, and Overhaul (MRO) under a Hanwha Ocean contract. The project exemplifies the operational reliability and technical sophistication that South Korean yards can provide, offering a lifeline to U.S. naval sustainment efforts.

However, the visit went beyond technical reviews. Secretary Phelan emphasized that the relationship between the U.S. Navy and South Korea’s maritime industry is foundational to securing a “free and open Indo-Pacific”—a core tenet of U.S. defense policy. He acknowledged that enduring naval power cannot be built on aging shipyards and outdated supply chains. Rather, it demands a resilient, scalable, and agile shipbuilding ecosystem supported by allied cooperation, innovation, and industrial integration.

Vice Chairman Kim reinforced Hanwha Ocean’s commitment to this vision. He noted that Hanwha is not only executing U.S. Navy MRO projects but has made strategic investments to directly support American shipbuilding. The acquisition of the Hanwha Philly Shipyard in December 2024 represents a transformative moment—the first time a Korean company has established a manufacturing base within the U.S. naval industrial infrastructure. This facility, along with a growing footprint through investment in Austal USA in Alabama and California, positions Hanwha as a major enabler of America’s maritime resurgence.

Rebuilding the U.S. maritime industrial base is not merely a national economic project—it is a matter of defense readiness. The Navy’s ability to deter aggression, secure sea lanes, and respond to crises depends on a reliable fleet of warships, logistics vessels, and support platforms. Yet, with U.S. shipyards aging and struggling to meet demand, the Navy faces delays in production and refit schedules. The situation is compounded by a shortage of skilled labor and an increasingly complex global security environment, where threats are dynamic and persistent.

Recognizing this, the U.S. Government has called for a multi-pronged recovery plan. This includes long-term, stable federal funding, reforms to make U.S.-built ships competitive, and partnerships that inject capability, capital, and innovation into domestic shipyards. Hanwha Ocean’s engagement fits directly into this framework, offering proven shipbuilding methodologies, digital shipyard technologies, and cost-effective project execution—all backed by a workforce known for precision and discipline.

Furthermore, the strategic synergy between Hanwha and the U.S. Navy aligns well with future force structure needs. As the Navy explores concepts such as distributed maritime operations, autonomous logistics vessels, and multi-domain force integration, industrial partnerships with technologically advanced allies will be crucial. Hanwha’s experience in building high-end surface vessels, submarines, and advanced support platforms can complement U.S. efforts to build a more agile, survivable, and sustainable fleet.

Ultimately, Secretary Phelan’s visit is emblematic of a shifting paradigm in how the United States approaches naval power. No longer is shipbuilding confined to domestic boundaries—it is becoming a transnational enterprise grounded in alliance networks and industrial interoperability. South Korea, through Hanwha Ocean, has emerged as a central node in this network, offering solutions that are not only operationally relevant but strategically indispensable.

As geopolitical competition intensifies and maritime domains become more contested, partnerships like the one between Hanwha Ocean and the U.S. Navy will determine the balance of power at sea. This cooperation reflects a shared vision: to build not just more ships, but a more secure, stable, and strategically aligned maritime future.