HD Hyundai Group has launched shipbuilding operations at its Subic shipyard in the Philippines, marking the facility’s first vessel construction. The move leverages low-cost local labor to strengthen price competitiveness against Chinese shipbuilders and positions the Philippines as a strategic base for the Korea-U.S. MASGA project.
HD Korea Shipbuilding & Offshore Engineering Co., the group’s intermediate shipbuilding unit, announced on Tuesday that it held a steel-cutting ceremony for a 115,000-ton petrochemical carrier at HD Hyundai Philippines Shipyard in Subic Bay. The event, which symbolizes the start of ship construction, was attended by Philippine President Ferdinand Marcos Jr., U.S. Ambassador to the Philippines MaryKay Carlson, South Korean Ambassador to the Philippines Lee Sang-hwa, and HD Korea Shipbuilding CEO Kim Sung-joon.
HD Hyundai Philippines, which until now had focused on ship block fabrication and maintenance, repair, and operations (MRO) services, is building its first ship as part of a four-vessel order placed by an Asian shipping company in December 2024.
The company established the Philippine shipyard in May 2024 after signing a land lease agreement with U.S. private equity firm Cerberus Capital. This is Hyundai’s second overseas shipyard following HD Hyundai Vietnam Shipbuilding, which was built in 1996 in Khanh Hoa Province, Vietnam. The Vietnam yard has since grown into the largest shipyard in Southeast Asia, building more than 10 vessels annually.
Drawing on its Vietnamese experience, HD Korea Shipbuilding plans to replicate the success in the Philippines. Industry observers view the Subic yard as a key strategic base that combines the cost advantage of Filipino labor with Korean shipbuilding technology, enabling it to compete with Chinese rivals dominating the bulk carrier and general cargo ship market with low-price offerings.
Beyond cost competitiveness, the Subic yard is also set to play a strategic role in trilateral economic and security cooperation among Korea, the United States, and the Philippines. HD Korea Shipbuilding said it will use the site as its Asia-Pacific hub for the MASGA project while enhancing efficiency through collaboration with existing overseas bases in Vietnam and Singapore.
“The Philippine shipyard is not just an overseas production base but a critical hub for strengthening global competitiveness in shipbuilding and ensuring the success of the MASGA project,” Kim said.
