Hanwha Philly Shipyard and its partner, Vard Marine, are competing with General Dynamics’ NASSCO shipyard in San Diego to secure a contract for building oiler ships for the U.S. Navy. The Philadelphia shipyard’s owner will collaborate with Vard Marine US Inc., an Italian-owned barge maker, to develop plans for the vessels under a $4.5 million contract.

First Navy Subcontract for Hanwha

This contract represents the first Navy subcontract for Hanwha Philly Shipyard since the Korean-owned company purchased the shipyard almost two years ago. Hanwha began applying for Navy work alongside its existing civilian ship construction projects as it expands the yard, which previously operated as a Navy shipyard until 1994.

Repurposed Vessel and Current Projects

In March, the Acadia, a ship originally commissioned by Great Lakes Dredge & Dock Co. for offshore wind electricity plant maintenance, completed sea trials at Hanwha Philly. The offshore wind program was cancelled by President Donald Trump, leading to the Acadia being repurposed for harbor construction work. Currently, Hanwha is completing ships contracted by the yard’s previous owner, Aker.

Investment and Expansion

Hanwha has invested over $100 million in improvements at the South Philadelphia site. Company officials hope to win more Navy contracts and build the ships directly at Hanwha Philly Shipyard. The yard currently employs approximately 2,100 people, an increase from around 1,700 before Hanwha’s acquisition in 2024.

Strategic Location and Future Goals

The shipyard’s location at the confluence of the Delaware and Schuylkill Rivers was described by former Navy Secretary John Lehman as “one of the best in the world,” possessing “great potential” with adequate capitalization and management. Hanwha aims to increase production from one ship every eight months to 20 ships annually to achieve profitability.

Boosting Philadelphia’s Shipbuilding Industry

Hanwha’s efforts align with U.S. plans to revitalize the commercial shipping industry. The company intends to build more cargo ships in Philadelphia and leverage commercial efficiencies to reduce costs on Navy projects. The yard’s neighbors, like Rhoads Industries, which employs around 700 workers building components for Navy submarines, are also experiencing growth.

Workforce Development and Training

Both Hanwha and Rhoads are actively hiring welders and other skilled workers, anticipating a doubling of employment in the coming years. Hanwha’s union workers earn an average of $34 per hour, with overtime potentially exceeding $100,000 annually. Pre-apprenticeship programs, such as the Welcoming Center’s Global Skills Union Pathways Project, are preparing individuals for successful apprenticeships at Hanwha.

Abdourahmane Diallo, a former warehouse owner from Guinea, West Africa, and Yacine Bouaziz, an Algeria native, both recently completed pre-apprenticeship programs and are now pursuing apprenticeships at Hanwha, citing the shipyard’s commitment to safety and stable career opportunities.

Recent Ship Deliveries

The State of Maine, the third of five training and multimission ships built for merchant-marine academies, was delivered to Maine in April. The Lone Star State is scheduled for completion this year and will be sent to Texas, while the Golden State is expected to be delivered to California next year. The rock installation ship Arcadia also departed for sea trials last month.

Tom Anderson, president of Hanwha Defense USA’s shipbuilding division, stated that the contract is “an important step in leveraging Hanwha’s shipbuilding expertise” for the Navy.