South Korea offers to build five Aegis destroyers per year to help the US counter China at sea

South Korea offers to build five Aegis destroyers per year to help the US counter China at sea .

As reported by Chosun on March 18, 2025, South Korea’s HD Hyundai Heavy Industries (HD HHI) hosted a handover ceremony at its Ulsan headquarters for Jeongjo the Great, the lead vessel of Korea’s next-generation Aegis destroyers. During the event, HD HHI stated that it can build up to five Aegis destroyers per year for the U.S. Navy if bilateral cooperation is formalized, and that it is prepared to expand this capacity further depending on demand. The company emphasized that these Aegis destroyers are equivalent in size and performance to the U.S. Navy’s Arleigh Burke-class. This announcement comes as the United States faces structural limitations in its domestic shipbuilding sector, where the number of shipyards has declined from over 400 to fewer than 30.

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The combined output of the only U.S. shipyards currently capable of building Aegis destroyers remains below the Navy’s stated requirement of at least three Arleigh Burke-class destroyers annually, as their combined output is around 1.6 to 1.8 ships per year. (Picture source: US Navy)

South Korea’s HD Hyundai Heavy Industries is positioning itself as a strategic partner in the evolving U.S. naval shipbuilding landscape, as the United States seeks to ramp up ship production in response to China’s maritime expansion. To date, HD HHI remains the only South Korean company capable of both designing and constructing Aegis destroyers. It built five of the six such ships acquired by the South Korean Navy, including the first, Sejong the Great. It is also the only domestic shipyard with a dedicated combat system integration team capable of incorporating and testing the Aegis Combat System, one of the most complex and critical components of modern warships. More than 250 engineers at HD HHI are qualified to design and build Aegis destroyers with performance levels matching those of U.S.-built equivalents. The company claims that South Korea can construct Aegis destroyers with the same capabilities as the U.S. Navy’s Arleigh Burke class at a more competitive cost and within two-thirds of the time required by American shipyards. This statement coincides with growing discourse within American defense circles about leveraging allied shipbuilding capabilities amid the declining capacity of the domestic shipbuilding base. HD HHI’s confidence in its potential contribution stems from the fact that its Ulsan facility is currently engaged in the simultaneous construction of 12 surface vessels, including offshore patrol vessels and corvettes for the Philippine Navy, demonstrating high throughput across both domestic and export-oriented projects. The potential opening of the U.S. naval shipbuilding market—long protected by national security laws and the Jones Act—could create significant opportunities for foreign shipyards. According to a report by Korea’s trade promotion agency KOTRA, the U.S. Navy plans to acquire 364 ships over the next three decades, requiring an annual construction rate of 12 ships. The core rationale for this expansion is to maintain parity with, or exceed, the Chinese People’s Liberation Army Navy (PLAN), which is rapidly growing in both size and technological sophistication. Experts estimate that China could field more than 400 modern surface combatants before 2030, challenging the current supremacy of the U.S. Navy. Jeong Woo-man, Vice President of HD HHI's Special Ship Business Unit, recently emphasized that the company's dedicated destroyer dock alone can produce at least one Arleigh Burke-class equivalent vessel per year, and could expand production to five annually if cooperation with the U.S. proceeds. He further stated that HD HHI has room to increase capacity even beyond this target. The company is also considering broader engagement with the U.S. defense market through participation in the Navy’s maintenance, repair, and overhaul (MRO) efforts. It aims to win two to three MRO pilot contracts this year and intends to help develop standardized procedures for the future sustainment of U.S. naval vessels.

Equipped with the Aegis Combat System, the Arleigh Burke-class destroyers can carry out multi-mission operations, including air defense, missile defense, anti-surface warfare, anti-submarine warfare, and land attack. (Picture source: US Navy)

HD HHI's historical achievements lend further weight to its proposal. The company delivered Sejong the Great to the Republic of Korea Navy in 2008 as South Korea’s first Aegis destroyer, having also led its design. In November 2024, it delivered the lead ship of the new Jeongjo the Great-class on time, reinforcing its reputation for meeting project schedules. Construction on the second and third ships of the class continues. Earlier in 2024, HD HHI Vice Chairman Chung Ki-sun introduced the company’s naval production facilities and ongoing projects to U.S. Secretary of the Navy Carlos Del Toro, signaling an intention to deepen cooperation. Looking ahead, HD HHI continues to scale its facilities in Ulsan, converting commercial docks into military production zones and investing in engineering capacity to meet growing international demand. As the Aegis Combat System continues to evolve—supporting the latest Standard Missile variants, integrating AN/SPY-6 radars, and increasingly serving as a platform for ballistic missile defense—the industrial base capable of supporting these platforms must evolve as well. Whether the United States opts to integrate HD HHI into its naval expansion plan remains uncertain, but the Korean firm’s readiness to participate in large-scale production offers a compelling option at a time of intensifying strategic competition. The Aegis Combat System is an integrated naval weapons system developed by Lockheed Martin for use on U.S. Navy and allied surface combatants. The system is centered around the AN/SPY-1 passive electronically scanned array radar, the MK 99 Fire Control System, the Weapon Control System, and the Command and Decision Suite. Upgrades such as the Multi-Mission Signal Processor (MMSP), Aegis Baseline 9 and 10 software, and the AN/SPY-6 radar have expanded its capability to engage more complex threats, including maneuverable and hypersonic targets. As of early 2025, 114 Aegis-equipped ships are operational, with 72 additional vessels planned. The system is in service with six allied navies: Japan, Australia, Canada, South Korea, Spain, and Norway.

To date, HD HHI remains the only South Korean shipyard with a dedicated combat system integration team capable of incorporating and testing the Aegis Combat System, one of the most complex and critical components of modern warships. (Picture source: HD HHI)

Equipped with the Aegis Combat System, the Arleigh Burke-class destroyers can carry out multi-mission operations, including air defense, missile defense, anti-surface warfare, anti-submarine warfare, and land attack. The system allows these destroyers to detect and engage multiple threats simultaneously, including cruise and ballistic missiles, at extended ranges and in highly contested environments. With the introduction of the latest software baselines and radars such as the AN/SPY-1D(V) and AN/SPY-6, these destroyers can now track hypersonic threats and perform simultaneous engagements using missiles like the SM-3 for exoatmospheric intercepts and SM-6 for terminal defense. Recent tests, including FTX-40 involving USS Pinckney, demonstrate that the class can virtually engage a hypersonic medium-range ballistic missile (MRBM) target, confirming the Aegis’ evolving performance against next-generation missile threats. However, since the commissioning of the USS Arleigh Burke (DDG-51) in 1991, the production and delivery rates of Arleigh Burke-class destroyers have varied depending on U.S. Navy procurement decisions, budget allocations, and shipyard output. During the 1990s and early 2000s, the delivery rate typically ranged between two and three ships per year, supported by General Dynamics’ Bath Iron Works and Huntington Ingalls Industries’ Ingalls Shipbuilding. The highest annual delivery occurred in 2000, when five ships—DDG-85 through DDG-89—were delivered. The lowest rate was recorded in 2012, with the delivery of only one vessel, USS Michael Murphy (DDG-112), during a period when the Navy had shifted focus to the Zumwalt-class program. Production resumed in 2013 under the "IIA Restart" phase, beginning with DDG-113, followed by the "Technology Insertion" batch and the introduction of the Flight III variant. From 2018 to 2022, the Navy procured two ships per year, a rate planned to continue through 2027 under the current multi-year procurement strategy. Despite these efforts, the combined output of General Dynamics and Huntington Ingalls Industries—the only U.S. shipyards currently capable of building Aegis destroyers—remains below the Navy’s stated requirement of at least three Arleigh Burke-class destroyers annually. Their combined output of around 1.6 to 1.8 ships per year does not align with this requirement. In contrast, South Korea's HD HHI maintains the engineering workforce and dock capacity necessary to exceed that rate. The company has stated that even under current constraints, its specialized dock for destroyers could deliver at least one ship per year compatible with U.S. Navy standards, and that this number could grow to five if a bilateral program is established.

From 2018 to 2022, the US Navy procured two Arleigh Burke-class destroyers per year, a rate planned to continue through 2027. (Picture source: US Navy)