Hanwha Philly Shipyard Selected by TOTE to Build First Medium Landing Ship
Hanwha Defense USA was officially named as the first shipbuilder selected by TOTE Services to build a Medium Landing Ship (LSM) for the U.S. Navy and Marine Corps under TOTE Services' Vessel Construction Manager (VCM) contract. The selection marks Hanwha Defense USA's first contract to build ships for the U.S. Navy and a key step for Hanwha Group, which has aspired to win government contracts since buying the Philly Shipyard in December 2024.
TOTE Services was awarded a $2.2 billion VCM contract to support the Navy and Marine Corps' planned 35-ship McClung-class landing ships fleet. The VCM model, which was pioneered with the construction of the five National Security Multi-Mission Vessels, the training ships for the five state maritime academies, appoints TOTE to oversee the shipyard selection, design, construction, testing, delivery, and lifecycle logistics. TOTE highlights that the model establishes one accountable management structure, which helps to accelerate the projects, management, and cost control for the program.
As VCM for the LSM program, TOTE Services issued a competitive request for proposals (RFP) to qualified U.S. shipyards in July 2026. The concept is for a class of 100-meter (328-foot) shallow-draft, shore-to-shore amphibious ships based on the design developed by Damen. They would be able to carry approximately 250 marines or up to approximately 500 to 800 tons of cargo.
Hanwha Defense USA (HDUSA) is the first shipbuilder selected through the RFP process, based on its competitive pricing and acceptance of TOTE Services' subcontract terms and conditions. The award covers construction of one LSM, valued at $269 million, at Hanwha Philly Shipyard, with options for three additional vessels.
"This award shows the speed at which the VCM model can move from RFP to contract," said Jeff Dixon, President of TOTE Services. "Through a competitive process, we secured strong terms that benefit the government, along with build positions that allow construction to start in the fourth quarter of 2027.”
TOTE Services reports the program will include up to eight new vessels under the base contract. It reports contract discussions are continuing with Bollinger Shipyards and Fincantieri Marinette Marine, both directed shipyards under the VCM contract, which are expected to play a meaningful role in building the LSM fleet. TOTE highlights that the program includes standardizing configuration across the fleet, using block buys to secure favorable pricing, and rapid delivery of the vessels.
News of the contract comes the same week as Hanwha Group announced that Hanwha Defense USA would take control of the majority ownership stake in the Philly Shipyard. Another division, Hanwha Systems, has held the 60 percent ownership share since the acquisition, with the remaining 40 percent held by Hanwha Ocean.
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"Since acquiring Philly Shipyard in 2024, Hanwha has made significant investments in its workforce and technology to pave the way to build ships for the U.S. Navy and other federal customers," said HDUSA President & CEO Michael Coulter. The group points out that Hanwha Defense USA personnel have been in Philadelphia working to ensure the shipyard is ready for naval work. It has invested in the systems at the yard and expanded employment.
Hanwha’s plan calls for transitioning the shipyard to a combination of government and commercial work. The yard is currently completing the outfitting of the fifth training ship, Golden State, due for delivery in 2027, while also constructing three containerships for Matson. TOTE and Hanwha Philly Shipyard this month also completed the contract for the new Missile Range Instrumentation Vessel (MRIV) project. Hanwha was awarded the construction contract for the first vessel based on the same hull as the training ship, plus options for two more vessels. The yard reported that the first of the ships would be delivered in 2030.
