Hanwha Aerospace's Daejeon Plant Shutdown Extended, Restart Expected in July

The shutdown of Hanwha Aerospace's Daejeon facility, where an explosion occurred, is expected to last until at least July. This extended closure is likely to disrupt the production schedule for key defense products, including propulsion systems and tactical ground-to-ground systems.

As of June 23, the Daejeon facility has remained closed since the incident on June 1. The Daejeon Regional Employment and Labor Office issued a partial work stoppage order for Building 56, but the company decided to halt all operations to enhance safety measures.

Employees at the Daejeon facility have been undergoing safety awareness training since June 15. Instructors from external safety organizations, including the Korea Industrial Health Association and the Korea Safety Education Association, are conducting the training. Since employees are participating in training during work hours and the company is also conducting on-site safety inspections, normal operations are not feasible.

The safety training is scheduled to continue until July 9, making it unlikely that the Daejeon facility will return to normal operations this month. The restart is expected to occur next month, once the residual risks from the explosion are addressed and work methods are reviewed.

Disruptions in the production of weapon systems contracted by Hanwha Aerospace are also anticipated. The Daejeon facility is a key site for producing core defense products, including guided missile propulsion systems. As the shutdown period extends, delays in production schedules, adjustments to delivery plans, and reallocations of production volumes will be necessary.

Industry insiders believe that while the immediate impact on contract fulfillment is limited, delays in safety measures and the restart process could increase pressure on production plans for the second half of the year. As of the end of the first quarter, Hanwha Aerospace's defense sector backlog stood at 38.173 trillion won.

Due to the nature of defense projects, the quality verification and process stability of key components like propulsion systems are crucial, making it difficult to transfer production to other facilities or initiate alternative production in a short timeframe. Additionally, given the human casualties from the recent incident, the company must prioritize safety over normalizing production.

An industry official stated, "Unlike general manufacturing, defense products require separate verification procedures during changes in production processes or equipment relocation. If the restart is delayed, adjustments to some delivery schedules may be unavoidable."