Defense Acquisition Program Administration notifies companies of evaluation results Thursday afternoon; score gap between rivals just 0.5 points; Hanwha Ocean vows to make up for delayed schedule if selected

A concept design model of the Korean Next-Generation Destroyer (KDDX) by Hanwha Ocean. [Herald DB]
A concept design model of the Korean Next-Generation Destroyer (KDDX) by Hanwha Ocean. [Herald DB]

Hanwha Ocean has in effect been selected as the contractor for the detailed design and lead-ship construction of the Korean Next-Generation Destroyer, known as the KDDX. The final score gap between the two competing firms was approximately 0.5 points.

According to the defense industry, the Defense Acquisition Program Administration notified each company Thursday afternoon of its individual evaluation results for the KDDX detailed design and lead-ship construction contract. The score difference between the two bidders was around 0.5 points.

The preferred negotiating partner is expected to proceed with the KDDX's detailed design and lead-ship construction after holding detailed consultations with DAPA. However, the timeline could be delayed if HD Hyundai Heavy files an objection or pursues legal action such as an injunction.

The decisive factor in the competition was a penalty deduction applied to HD Hyundai Heavy. Nine of the company's employees were indicted on charges of photographing and leaking KDDX concept design documents from Daewoo Shipbuilding and Marine Engineering — the predecessor of Hanwha Ocean — in 2015. Eight were found guilty in November 2022 and one more in December 2023.

DAPA had initially set the penalty period to expire in November 2025, but after an internal legal review last year it changed course, deciding to treat the November 2022 and December 2023 convictions separately. Using the date of the final guilty verdict as the benchmark, DAPA concluded that a 1.2-point security penalty deduction would apply to HD Hyundai Heavy through the end of this year, based on the last conviction being finalized in December 2023. HD Hyundai Heavy filed for an injunction in response, but a court rejected it on June 5.

The KDDX program calls for building six domestically produced, 6,000-ton Korean Aegis destroyers by 2030 at a cost of approximately 7.8 trillion won (about $5.16 billion). The program proceeds in stages: concept design, basic design, detailed design and lead-ship construction, and follow-on ship construction. While the two companies could ultimately share construction work, the contractor handling the detailed design and lead-ship construction is expected to lead the overall program, making the outcome closely watched.

Hanwha Ocean issued a statement Thursday saying it had received a strong evaluation based on its advanced warship technology and project execution capabilities. "If we are ultimately selected as the preferred negotiating partner, we will work closely with DAPA in accordance with program procedures, mobilizing all of our ship design and construction capabilities to make up for the delayed schedule and ensure there is no disruption to naval force readiness," the company said.

The company added that it would strive to achieve world-class performance and quality through complete systems integration, noting that the KDDX will carry nine types of key domestically developed equipment. "We will dedicate ourselves to the timely fielding of the KDDX as a steadfast partner supporting the strengthening of the Republic of Korea Navy and its leap toward a blue-water force," Hanwha Ocean said. The company also pledged to strengthen the Korean naval defense industry ecosystem through cooperation with small and midsize partners and contribute to regional economic development.


keg@heraldcorp.com