A MASGA cap. [Yonhap]
A MASGA cap. [Yonhap]

South Korea is establishing a local foothold in the United States to accelerate the MASGA shipbuilding cooperation project, with the government and the country's three leading shipbuilders set to attend an opening ceremony in Washington this month and explore further collaboration with American industry partners.

According to government and industry sources Friday, South Korea plans to hold the opening ceremony of the Korea-US Shipbuilding Cooperation Center in Washington, D.C., on July 23. The event is expected to draw top executives from all three major Korean shipbuilders — Kim Hyung-kwan, president and CEO of HD Korea Shipbuilding; Choi Sung-an, vice chairman and CEO of Samsung Heavy Industries; and Jeong In-seop, president and head of management support at Hanwha Ocean — alongside Industry Minister Kim Jung-kwan. On the American side, US Commerce Secretary Howard Lutnick is set to attend, and South Korean Ambassador to the United States Kang Kyung-wha has also been invited.

The center's establishment follows a memorandum of understanding on the Korea-US Shipbuilding Partnership Initiative that Kim and Lutnick signed in Washington in May. The center will be tasked with building local networks, sharing policy developments and supporting cooperation between companies from the two countries. It will also help improve productivity at American shipyards and run workforce training programs.

The three shipbuilders are expected to use the opening ceremony as a springboard to deepen their MASGA-related activities in the US. Hanwha Group has already acquired the Philly Shipyard in Pennsylvania and is pursuing the licenses needed to build combat vessels there. HD Hyundai and Samsung Heavy Industries have each formed partnerships with US shipbuilders — Huntington Ingalls and General Dynamics NASSCO, respectively. This year, HD Hyundai Heavy and Hanwha Ocean have each secured two US Navy maintenance, repair and overhaul contracts, bringing the combined total to four.

South Korea's shipbuilding industry has anticipated significant gains from the MASGA project since Donald Trump began his second term last year. The US Navy has traditionally built its vessels exclusively at domestic shipyards, but those yards have been struggling with aging infrastructure, production delays and labor shortages. South Korean shipbuilders have accumulated unrivaled technical expertise across a wide range of vessel types over many years and have a strong export track record, making shipbuilding a sector widely seen as offering maximum synergy between the two countries.

South Korea and the United States agreed last year to direct $150 billion of a $350 billion US-bound investment package toward shipbuilding cooperation. The MASGA project has gained further momentum as the US has moved to actively explore warship construction partnerships with South Korean yards. The US Defense Department and Navy have recently sent requests for information to South Korean shipbuilders regarding combat vessels and replenishment oilers, according to sources. An RFI is a procedure the administration uses to gather pricing, delivery terms and market information before drawing up formal plans.

HD Hyundai Heavy and Hanwha Ocean have submitted materials on their combat vessel design and construction capabilities in response, and all three Korean shipbuilders — including Samsung Heavy Industries — have replied to the RFI for replenishment oilers, sources said. Some in the industry are cautiously raising hopes that the US may begin to ease the legal restrictions governing naval vessel construction abroad. Building US Navy ships at foreign shipyards is currently prohibited in effect under the Barnes-Tollefson Amendment.


keg@heraldcorp.com