HD Hyundai Wins First Repair Project from U.S. Military Sealift Command

Competition continues to build for work under the U.S.’s MRO (Maintenance, Repair, and Overhaul) contracts, with HD Hyundai Heavy Industries reporting it has won its first assignment. The company reportedly said it would be targeting two to three contracts a year from the United States, and it is linking this to Korea’s promised investment made during the trade talks.

HD Hyundai was certified and signed a Ship Maintenance Relations Agreement (MSRA) with the U.S. military authorities in July 2024. Media reports from Korea suggest it had bid on two previous contracts, losing one to its Korean rival Hanwha Ocean and another to a Singapore-based yard. Hyundai was also reported to have space constraints as its yards are busy with commercial work.

The yard has won the MRO contract for USNS Alan Shepard, a 41,000-ton displacement Lewis and Clark class dry cargo and ammunition vessel used to support vertical replenishment for the U.S. Navy while on a deployment. The vessel, which is 210 meters (689 feet), was commissioned in 2007 and is currently assigned to the U.S. 7th Fleet.

Maintenance work is scheduled to begin in September at HD Hyundai Mipo in Ulsan, South Korea. The scope of work includes propeller cleaning, tank inspections and repairs, and equipment checks. The ship is slated for delivery back to the U.S. Navy in November.

It is the second vessel of the class to undergo its overhaul in Korea. Last year, the first MRO contract awarded to a Korean yard went to Hanwha Ocean to overhaul the USNS Wally Schirra, which arrived at Hanwha Ocean’s Geoje Plant in September. Hanwha also started a second job in late 2024 to repair USNS Yukon, a fleet replenishment vessel, and it was recently reported that it had won the repair assignment for USNS Charles Drew, another Lewis and Clark class vessel.

The MRO business is seen as a lucrative opportunity by the Korean industry. The U.S. military is estimated to spend more than $14 billion annually on MRO contracts. The Korean yards are competing against Japan and Singapore, which are also in the MRO market.

“This MRO contract is especially meaningful as it is the first awarded following the government’s proposal of the MASGA project for Korea–U.S. shipbuilding collaboration,” said Joo Won-ho, head of the Special Ship Business Unit at HD HHI. “As a representative of South Korea’s shipbuilding industry, we will make every effort to successfully complete the U.S. Navy’s logistics support ship MRO project.”

The Koreans are linking this project to the government’s planned $150 billion MASGA (Make American Shipbuilding Great Again) initiative proposed to the Trump administration during the trade talks. South Korea committed to a broader $350 billion investment in the United States to win a reduction in its tariff from 25 to 15 percent.

Both Hyundai and Hanwha completed the certification for U.S. repair work in 2024, while recently Korea’s mid-sized builder HJ Heavy Industries was also reported to be developing a consortium of suppliers for entry into the MRO business. The South Koreans hope to use this to expand their shipbuilding to include vessels for the U.S. government. HD Hyundai announced a strategic partnership with Edison Chouest Offshore for commercial shipbuilding, while Hanwha Ocean acquired Philly Shipyard.