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| A next-generation Redback infantry fighting vehicle maneuvers during a media invitation event in Hongcheon County, Gangwon Province, May 27. The Redback has been in the spotlight for innovative technologies meeting the requirements of future battlefield environments. Courtesy of Hanwha Defense |
Defense systems developer expands global presence to vie with Western players
By Park Jae-hyuk
South Korea has grown into one of the top 10 exporters of defense systems over the past decade, with a record $7 billion in arms contracts signed last year.
The remarkable growth has been attributed to technological innovation and strategic efforts to meet the demands of countries seeking to acquire reliable defense equipment.
Hanwha Defense, a defense business arm of Hanwha Group, has played a pivotal role in upgrading the reputation of the Korean defense industry.
The leading land defense systems manufacturer has successfully expanded its global footprint with the opening of its latest U.S. and Australian subsidiaries, as well as its sophisticated defense solutions, such as the K9 self-propelled howitzer (SPH) and the Redback infantry fighting vehicle (IFV).
Hanwha Defense has already been popular in the European region, in which, five nations have adopted the K9 SPH, as the company is getting more and more attention for its battlefield-proven defense equipment in the wake of the Ukraine conflict.
For a better understanding of how Hanwha Defense has pioneered its way into the international defense market, The Korea Times conducted exclusive written interviews with the marketing heads of the company's U.S., Australian and European headquarters.
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| John Kelly, president and CEO of Hanwha Defense USA / Courtesy of Hanwha Defense |
John Kelly, president and CEO of Hanwha Defense USA (HDUSA)
Q: What are the key marketing campaigns in the U.S.?
A: There are a number of key campaigns in the HDUSA region. The first campaign is related to the U.S. Army's Optionally Manned Fighting Vehicle (OMFV) program. HDUSA is part of a consortium, led by Oshkosh Defense, and is in the process of delivering design concepts to help inform the U.S. Army of options and trade space for their new IFV. The consortium will leverage the proven capability of the Redback for the OMFV design.
The next campaign is around U.S. Army artillery requirements and involves our globally proven K9 SPH and K10 ammunition carrier. Both of these vehicles offer advances in technology that the U.S. Army requires, especially in extended range, rate of fire and munition resupply.
Q: What are the key challenges?
A: The key challenge for any overseas business in the U.S. defense market is fair access and fair evaluation against domestic competition. HDUSA understands this and has recently opened its engineering center in Troy, Michigan, and will Americanize the development and manufacturing process of relevant products creating U.S. defense capability and U.S. jobs.
Q: What is the key strength of Hanwha's products?
A: Hanwha Defense's portfolio competes very well with existing U.S. players. Our IFVs and SPHs all exceed the capabilities of in-service U.S. systems.
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| Richard Cho, managing director of Hanwha Defense Australia / Courtesy of Hanwha Defense |
Richard Cho, managing director of Hanwha Defense Australia (HDA)
Q: What's the progress of marketing campaigns so far?
A: HDA is focused on the delivery and mobilization of Land 8116 Protected Mobile Fires, which will see the delivery of 30 AS9 SPHs and 15 AS10 ammunition resupply vehicles. The sole source contract was signed last December, and we are on track to deliver this game-changing capability for the Australian Defense Force on time and on budget with the Huntsman family of vehicles.
In preparation for this, HDA is building a new 32,000-square-meter facility in Geelong on a 15-hectare site, with construction work to commence later this year, to be completed in 2024.
We are shortlisted for Phase 3 of Land 400 that will see the Australian Army replace their M113 fleet with up to 450 IFVs valued at approximately AUD$27 billion over the coming decade. A decision from the Australian government is expected in the third quarter of this year.
Q: What's the rationale behind HDA's expansion into global markets?
A: Working successfully in Australia has given us better access to "Five Eyes" nations ― the U.S., the U.K., Canada, Australia and New Zealand ― to expand outreach into those countries. There are a number of vehicle and ammunition programs in those nations that are of interest to us at the moment as well as programs in Europe that we are watching closely.
Q: What is the key strength of Hanwha's products?
A: The scale of high technology manufacturing in Korea means that we can compete on price very effectively while also working with local companies in partner nations. The work we have done with K9 users internationally demonstrates this, with Norway, Finland, Estonia, Turkey, Poland, India (current users) and now Egypt and Australia (contracts signed) is testament to the strength of the technology on offer.
We have worked with each of these partners to make sure that their sovereign needs are addressed in both acquisition and sustainment.
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| Pasi Pasivirta, director of European business development at Hanwha Defense / Courtesy of Hanwha Defense |
Pasi Pasivirta, director of European business development at Hanwha Defense
Q: What are the key marketing campaigns?
A: Hanwha Defense has been marketing K9 SPHs and K10 ammunition resupply vehicles for some time in Europe. So far, we have been successful with countries like Estonia, Finland and Norway choosing K9 as their solution for self-propelled artillery.
We expect more European nations to modernize their artillery inventory by the end of this decade. Hanwha Defense stands ready to support these nations. Ground-based air defense (GBAD) and long-range rocket artillery are something that many European nations are focusing on right now.
Hanwha Defense has developed a hybrid GBAD platform that is in service with the Republic of Korea (ROK) Army. An updated version of this platform could be of interest for these nations.
Q: What are the key strategies?
A: For many European customers, security of supply is a key concern. Hanwha Defense has developed many different ways to meet these requirements. For example, Hanwha Defense is open to and has successfully completed transfer of technology in many cases.
With transfer of technology the customer can have local sovereign manufacturing capability and local supply chain for systems in question. Another focal point is in taking full advantage of Hanwha Defense's vast experience and knowledge in systems integration. Hanwha has worldwide experience with integrating different weapons systems and platforms. Customers tell what they want, and Hanwha makes it happen.
Q: What is Hanwha Defense's competitiveness against the European Union and the U.S. players?
A: Hanwha's products are fielded in large numbers. Hanwha's domestic customer has sizeable land force, and the ROK Army often acquires hundreds of systems. This means that there is lots of information available from systems that are used on daily basis. This information can be made available for the new customers. This reduces significantly risk of fielding a new system.
Taking K9 SPH for an example, there are more than 1,700 K9 SPHs in service around the world. That number exceeds by far any competing artillery guns.
Q: What is Hanwha Defense's response to the growing demand in the wake of the Ukraine crisis?
A: Hanwha Defense understands the needs and concerns of some European nations. Hanwha Defense has quite significant manufacturing capability for many types of defense solutions. This capability can be even expanded and made available for customers with urgent needs.
We have experience and readiness to support establishing local manufacturing capabilities in Europe. We are discussing with some nations these possibilities. We stand ready to support Europe and our European customers.
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| The flagship K9 self-propelled howitzer has nine customers around the world, and K9 users are set to expand further in the wake of the Ukraine conflict. Courtesy of Hanwha Defense |
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