An illustration of the Republic of Korea Navy's next-generation destroyer / Courtesy of HD Hyundai Heavy Industries

A decade-long competition between HD Hyundai Heavy Industries (HHI) and Hanwha Ocean to win the KDDX project is expected to come to a conclusion within a few weeks.

The Defense Acquisition Program Administration (DAPA) plans to hold a Monday afternoon meeting to review the contracting method for the 7.8 trillion won ($5.4 billion) project to construct the Republic of Korea Navy's six next-generation destroyers by 2030.

Following the review, the Defense Acquisition Program Promotion Committee will make the final decision next month on which shipbuilder will draft a detailed design of the KDDX-class destroyers and construct the first ship.

Last month, the Ministry of Trade, Industry and Energy designated both HD HHI and Hanwha Ocean as the companies eligible for the construction of the next-generation destroyers.

HD HHI, which was in charge of the basic design of the destroyers in 2020, is urging DAPA to follow the customary practice of awarding a sole-source contract with the company that drafted the basic design.

"As legal concerns have been resolved over this issue, DAPA should select the company to draft the detailed design and construct the first ship in accordance with laws stipulating the selection procedure," an HD HHI official said.

Viewing the co-design of the destroyers as impractical, the shipbuilder has said that the participation of multiple companies in designing the ships would make it difficult to determine which company should take responsibility in the event of any defects.

Hanwha Ocean, on the other hand, has emphasized that custom cannot precede law. The company was in charge of the conceptual design of the destroyers in 2012, when it was Daewoo Shipbuilding & Marine Engineering (DSME), before Hanwha's acquisition.

The shipbuilder asked DAPA to select multiple companies as participants in the project, through a competitive bidding process.

"A sole-source contract will unfairly provide preferential treatment to a certain company, nullifying penalties imposed on that company for its illegal acquisition of our conceptual design for the KDDX project," a Hanwha Ocean official said.

DAPA has typically awarded the companies that drafted the basic designs the responsibility of creating the detailed design and constructing the first ship through a sole-source contract.

However, DAPA has been asked to seek a competitive bidding process for the KDDX project after former HD HHI employees were found guilty of stealing DSME's conceptual design.

HD HHI and Hanwha Ocean filed lawsuits against each other last year over DAPA's decision to allow HD HHI to continue bidding for the KDDX and other warship construction projects for the Republic of Korea Navy, though they eventually reconciled to cooperate in the export of naval vessels.

As their fierce rivalry has delayed the construction of the first destroyer, which was supposed to begin last year, Chief of Naval Operations Yang Yong-mo last month sent letters to HD HHI and Hanwha Ocean to express his concerns over the belated introduction of new naval vessels.