Ticking all the boxes – why Peru picked HHI for naval modernisation
On 27 March, the Peruvian Navy announced that it had selected South Korean shipbuilder Hyundai Heavy Industries (HHI) for the procurement of one 3,400t frigate, one 2,200t OPV, and two 1,500t LCUs. My conversation with Peruvian Chief of Naval Operations Adm Luis José Polar Figari last October sheds some light on why HHI was perhaps the obvious choice.
‘For our frigates, OPVs and LCUs, we need a proven design by a foreign shipbuilder that will come to Peru and work with [national shipbuilder] SIMA to build the ships,’ Polar explained... Continues below
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Above: HHI will initially supply four vessels across three classes to Peru, with revitalising local industry being a major motivating factor. (Image: HHI)
The key to this requirement is rebuilding Peruvian industry partners’ capabilities.
As Polar explained, the country’s shipbuilding industry has been shrinking over the past decade due to the very small number of ongoing projects. ‘For instance, although we produce copper cables in Peru, we have been persistently importing them for our ships. This was due to the lack of a viable business case to increase production when only a few ships were being built or maintained every few years,’ he shared.
However, with the planned procurement of six frigates, four OPVs and two LCUs over the next 30 years – the current contract is just the beginning – there is now a compelling argument for revitalising that industry.
The choice of HHI as the foreign shipbuilder is logical in the context of Peru.
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First, the Peruvian Navy wanted to choose a foreign partner that could work closely with SIMA, and the country already has naval history with the Republic of Korea (RoK).
SIMA built Peru’s Makassar-class LPDs in collaboration with Daesun Shipbuilding & Engineering, while STX has supplied six patrol boats to Peru since 2013. Additionally, the Peruvian Navy already operates two corvettes gifted by the RoK.
The navy also wanted a proven design, as noted by Polar, and the HDF-3200 frigate solution, also selected by the Philippine Navy, is based on the Republic of Korea Navy (RoKN) Incheon class. The Philippines also went for the same HDP-2200 OPV solution.
Finally, Polar told me: ‘The weapons used on our ships either come from Europe or the RoK because we do not produce them here. We are also working on this aspect, and several shipbuilders from these countries have already started a conversation with our national industry associations to understand how to improve industry and standards to move production here.’
ADM Polar did not discuss each proposed design’s details and merits. Nevertheless, he did mention that BAE Systems, one of the 11 shipbuilders the navy contacted, was only interested in the frigate contract – which makes sense, considering the company is not known for its OPV and LCU designs.
As for Naval Group, the FREMM, while a successfully proven design, was too big for the needs of the Peruvian Navy, and the FDI has yet to enter service and build a track record.
In such a context, the choice of another South Korean shipbuilder should not have come as a big surprise to anyone.
Other articles in this newsletter:
AUKUS – why the alliance won't be accepting new members any time soon
Stormy seas – the impact of bad weather on autonomous USV navigation
Power play – what factors influence a navy’s choice of submarine propulsion?
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