HD Hyundai Makes Warships, And It Could Build Them For The US Navy

HD Hyundai Heavy Industries has been building advanced warships for decades. Now, it's in a prime position to start building them for the U.S. Navy. With new legislation proposed in early 2025, South Korea's top naval shipbuilder could soon become a direct supplier to America's maritime forces. The bills — the Ensuring Naval Readiness Act and the Ensuring Coast Guard Readiness Act — would allow U.S. warships to be built in allied nations like South Korea and Japan if they can do it faster and cheaper. That's where HD Hyundai comes in.

The company already builds Aegis-class destroyers, one of the deadliest warships in military history, for the Republic of Korea Navy. It recently delivered Jeongjo the Great, a next-gen destroyer, and has also built support vessels for the Royal New Zealand Navy and multi-purpose frigates (here's the difference between them and destroyers) for the Philippine Navy. The experience is there, and so is the scale; HD Hyundai operates the largest shipyard among U.S. allies, with the capacity to deliver up to five destroyers a year. For comparison, American shipyards are currently producing fewer than two. With China rapidly expanding its fleet, the U.S. Navy needs more ships, faster. Hyundai is offering just that.

The U.S. Navy, already one of the largest navies in the world by self-reported total naval assets, wants to grow from 295 to 390 ships by 2054. That means building 364 new warships, fast, to account for the retirement of old ships. But domestic yards don't have the space, labor, or throughput to meet that demand alone. Hyundai says it can help fill the gap. 

Unlike its Korean rival Hanwha, which acquired Philly Shipyard to build ships in the U.S., Hyundai is betting on the U.S. allowing ship construction in allied countries. The newly proposed bills would remove long-standing restrictions that prevent naval vessels and key components from being made outside the U.S. If passed, Hyundai could start building destroyers for the Navy in South Korea.

It's already built four Aegis destroyers for the Korean Navy and is the only South Korean shipbuilder that can offer full Aegis Combat System integration. That's critical, as the system is a core part of U.S. air defense and carrier strike group operations. Hyundai says it can build equivalent destroyers for half the cost of U.S.-built ones. It's already proving that point in Peru, where it's building warships at Peru's SIMA Shipyards using transferred design and tech packages. If the U.S. wants speed, affordability, and proven experience, Hyundai checks all three boxes.

Hyundai isn't acting alone, and it's been building strategic partnerships with U.S. firms like Huntington Ingalls Industries (HII) and Fairbanks Morse Defense to smooth the path forward. These deals include shared shipbuilding expertise and supply chain access. HII is the largest military shipbuilder in the U.S., and even it sees the benefits of teaming up. With bipartisan support in Congress, a growing Chinese naval fleet, and budget projections topping $30 billion annually for new ships, pressure is mounting to expand capacity fast.

President Trump has publicly backed allied shipbuilding partnerships. Lawmakers are pushing for updates to outdated policies like the Burnes-Tollefson Amendment, which currently limits foreign participation. If those walls come down, HD Hyundai is standing by with an offer to build American destroyers. The company's bet is simple: partner with allies, build faster, and help close the U.S. Navy's growing ship gap. With global defense contracts already rolling in and a Pan-Pacific shipbuilding strategy taking shape, HD Hyundai may soon be more than just South Korea's warship builder; it could become a core supplier for the U.S. Navy.