Hanwha Aerospace is experiencing a surge in its stock price following the announcement of a prototype contract with the U.S. Army for its next-generation self-propelled howitzer program.
As of 9:49 a.m. on August 19, Hanwha Aerospace shares were trading at 1,156,000 won, up 12,000 won (1.05%) from the previous trading day. The stock briefly soared to 1,255,000 won in early trading.
The selection of Hanwha Aerospace as the prototype supplier for the U.S. Army's self-propelled howitzer modernization program has sparked increased buying interest.
On August 18, the U.S. Army announced that it had signed a contract with Hanwha Defense USA, a subsidiary of Hanwha Aerospace, for the development of prototypes under the Maneuver Tactical Cannon (MTC) program. The contract is valued at approximately $10.3 million (about 14.17 billion won).
Hanwha Defense USA is set to supply six prototypes based on the K9 platform. The contract size could expand with additional supply options.
In a competitive field that included global defense companies, Hanwha Defense USA was chosen as the prototype supplier. The U.S. Army plans to evaluate the prototypes' performance, reliability, and supportability in environments similar to actual combat over the next three years.
Market analysts are paying close attention to the potential for this contract to lead to a large-scale follow-on production program. The final procurement volume is estimated to be around 500 units, with the follow-on project potentially worth about 10 trillion won. If the prototypes pass operational tests, there may also be opportunities for additional contracts related to ammunition, maintenance, and logistics support.
Hanwha Defense USA is establishing K9 production and testing facilities in Opelika, Alabama. This contract is expected to further expand local production capabilities in the U.S.
* This article has been translated by AI.
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