PHILADELPHIA, October 30, 2026 — Hanwha Defense USA has secured a controlling interest in the Philadelphia yard, restructuring the facility to pursue U.S. Navy contracts and rebuild the workforce after years of commercial decline.
Restructuring and Ownership Shift
Hanwha Defense USA, a subsidiary of Hanwha Aerospace, announced it will acquire a 60% controlling stake in Hanwha Philly Shipyard through a joint venture, transferring control from Hanwha Systems. The transaction, valued at approximately $237.6 million according to South Korean regulatory filings, is planned for completion by October 31. Hanwha Ocean will retain a 40% stake in the facility. The restructuring consolidates the yard’s commercial and government operations under a single leadership structure as Hanwha expands its U.S. defense footprint.
From Commercial Decline to Naval Revival
The Philadelphia facility, formerly part of the Aker Group and listed on the Oslo Stock Exchange, began a steep decline after delivering the final Matson containership in 2019. The workforce fell from roughly 1,200 employees at the start of 2018 to just 80 by July 2019. The yard pivoted to government work to survive, beginning with maintenance contracts for the Maritime Administration’s Ready Reserve Force and expanding through the National Security Multi-Mission Vessel program. Selected in April 2020 for the first two ships under a $630 million contract managed by TOTE Services, the program grew to include five vessels, providing the production backlog necessary to rebuild the staff.
Bidding on McLung-Class Ships
Hanwha Defense USA President and CEO Michael Coulter confirmed at the Ironclad Maritime Summit that the company has bid to build the McClung-class Landing Ship Medium for the Navy and Marine Corps. Retired Rear Adm. Tom Anderson, president of U.S. shipbuilding at HDUSA, will oversee all American shipbuilding operations. The facility, which has delivered approximately 50% of all large ocean-going U.S. Jones Act commercial ships since 2000, is being prepared for dual-use production serving both federal agencies and commercial customers.
Workforce and Training Investment
The yard’s revival has been supported by an earn-while-you-learn apprenticeship program offering training in welding, outfitting, and machine operation. Hanwha Group, a multinational conglomerate with operations in energy, shipbuilding, defense, aerospace, finance, and technology, continues to invest in the Philadelphia facility. The company’s expansion into naval shipbuilding represents a significant shift for a yard that once employed over a thousand workers and now stands positioned to compete for next-generation U.S. Navy contracts.
Historical Commercial Shipbuilding Legacy
The Philadelphia facility, which began operations in 2000 as a cooperation between Kværner, the City of Philadelphia, the Commonwealth of Pennsylvania, and the United States government, has a long history of Jones Act-compliant construction. Following its initial delivery of the container ship MV Manukai in 2003, the yard produced a series of vessels for various commercial operators. By 2013, the shipyard had completed fourteen product tankers for American Shipping Company, Overseas Shipholding Group, and Crowley.
The yard’s commercial output also included large-scale projects for major energy firms. In 2011, Aker Philadelphia signed a contract with SeaRiver Maritime Inc., a subsidiary of ExxonMobil, to construct two Aframax oil product tankers. Delivered in 2014, these vessels measured 820 feet in length with over 115,000 tons deadweight, representing the largest ships built by the yard at that time. These tankers were designed to transport 800,000 barrels of Alaskan North Slope crude oil and featured double hull protection and energy-efficient engines.
In addition to tankers, the shipyard expanded its commercial portfolio in 2013 by signing a joint business venture with Crowley Maritime Corp to construct eight product tankers, a deal valued at $500 million. By 2014, the facility also announced the construction of Aloha-class container ships for Matson, Inc., alongside the establishment of Philly Tankers, a Jones Act shipping company, to manage a fleet of eco-design product tankers.
NSMV Program and Workforce Rebuilding
The transition to government contracts began in earnest in April 2020, when Philly Shipyard was selected to construct the first two National Security Multi-Mission Vessels under a $630 million contract managed by TOTE Services. The program expanded to include five vessels, providing the long-term production backlog necessary to reverse the steep workforce decline that had seen employee numbers fall from approximately 1,200 at the start of 2018 to just 80 by July 2019. This work allowed the facility to recall laid-off workers and return drydocks to active use, establishing a foundation for future naval construction.
Retired Rear Adm. Tom Anderson, president of U.S. shipbuilding at Hanwha Defense USA, stated that the yard has made significant investments in the facility over the past two years to revitalize the U.S. shipbuilding industry. The earn-while-you-learn apprenticeship program, which trains workers in welding, outfitting, and machine operation, has been central to this effort. As Anderson noted, these initiatives are designed to prepare the workforce for the dual-use production model serving both federal agencies and commercial customers.
Strategic Dual-Use Positioning
The restructuring of Hanwha Philly Shipyard establishes a dual-use production model designed to serve both federal agencies and commercial customers simultaneously. This operational shift allows the facility to leverage its historical dominance in Jones Act compliance, having delivered approximately 50% of all large ocean-going U.S. Jones Act commercial ships since 2000, while integrating new naval capabilities. The consolidation of operations under Hanwha Defense USA ensures that government and commercial shipbuilding efforts are aligned under a single leadership structure.
By aligning its multi-domain presence across the United States with the Philadelphia facility, Hanwha aims to revitalize the domestic shipbuilding industry through significant investments made over the past two years. The yard’s capacity to handle complex projects, ranging from the construction of National Security Multi-Mission Vessels to the upcoming McClung-class Landing Ship Medium bids, demonstrates its readiness for next-generation U.S. Navy contracts.
This strategic positioning marks a definitive transition from a facility that once faced commercial decline to a revitalized center of American naval power. As Hanwha continues to expand its footprint in energy, shipbuilding, defense, aerospace, finance, and technology, the Philadelphia site stands prepared to compete for high-value federal work while maintaining its legacy of building eco-design product tankers and container ships for private operators.
Sources
- Hanwha Philly Shipyard
- Hanwha Defense USA to Take Control of Philly Shipyard as Navy Shipbuilding Push Accelerates
- Philadelphia shipbuilding poised for revival as Hanwha bids on next-generation Navy contracts
Photo: Tmarinucci (talk) (Uploads) (Public domain)
