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Hyundai Heavy Industries

Hyundai Heavy Industries

Industry: 
Construction, Manufacturing, Shipping
Value of USG Contracts: 
343
Symbol: 
KRX:009540
States: 
FL
NJ
TX
Country: 
South Korea
Sources: 

 

"Major Iranian shipping company Islamic Republic of Iran Shipping Lines and oil producer Iranian Offshore Oil Co. have reached preliminary deals with South Korean shipyards for orders worth around $2.4 billion, people involved in the talks said Tuesday. The agreements are part of Iran’s efforts to make a comeback in global shipping after the lifting of international sanctions earlier this year, but completing the orders will depend on financing that the Iranians haven’t yet secured, the people said. 'The yards are making slots available to the Iranians starting in 2018 and 2019,' one of the people said. 'The Iranians are trying to make the 20% down payments through oil state-to-state deals to finalize the orders.' ... Islamic Republic of Iran Shipping Lines, known as IRISL, operates a fleet of container vessels, bulk carriers and tankers. It has signed a memorandum of understanding with Hyundai Mipo Dockyard, a subsidiary of shipbuilding giant Hyundai Heavy Industries Group, for up to 10 petroleum-product tankers and at least six so-called handysize bulk carriers. Product tankers cost around $30 million each and handysize bulkers around $20 million apiece. IRISL also is in talks with Hyundai Heavy for up to six 14,500 container ships which cost around $115 million each, the people involved in the talks said." (The Wall Street Journal, “Iranian Oil, Shipping Companies Set For $2.4 Billion Ship Deals,” 6/7/2016)

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“HHI is currently negotiating with IRISL on making three 14,500 TEU (20-foot equivalent unit) container ships worth $350 million. The company expects to finalize the deal in the second quarter.” (Korea Joongang Daily, “Shipbuilders strive to enter new markets,” 4/15/2016)

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"Islamic Republic of Iran Shipping Lines is negotiating with Hyundai Heavy Industries to purchase up to three mega-ships with capacities of 14,500 twenty-foot-equivalent units, sources close to the matter said. The purchase will help IRSIL break into the ranks of the world’s largest container lines by capacity. Its total capacity of 96,160 TEUs ranks it as the 22nd-largest global carrier, according to maritime analyst Alphaliner. Sources said the ships would range in cost from $120 to $130 million and represent the continuation of a relationship between the Hyundai group and IRISL. 'In 2008, IRISL ordered some ships in our sister yard, Hyundai Mipo Dockyard, but that order was suspended as sanctions kicked in,' a source at HHI said. 'Now, IRISL wants larger ships, which is under the purview of HHI.' The purchase comes after IRISL and CMA CGM in January with the signing of an agreement on terminal access, capacity sharing, and jointly operating certain routes. If HHI wins the deal, it will be the first South Korean shipbuilder to win orders from an Iranian company since the lifting of international sanctions on Iran in January." (JOC, “Islamic Republic of Iran Shipping Lines in talks for mega-ships”, 4/6/2016)

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Hyundai Oilbank and Hyundai Corporation are subsidiaries of Hyundai Heavy.

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"Iran said on Saturday that a deal has been reached with South Korea to launch a joint shipbuilding venture between the two countries. The venture will be established between Iran Shipbuilding and Offshore Industries Complex Company (ISOICO) and Hyundai, IRNA reported. ISOICO Managing Director Hamid Rezaian has emphasized that the related consultations as well as key agreements for the move have already been taken care of... Rezaian had announced in late November that ISOICO is looking into partnerships with major international shipbuilders including Hyundai and Germany's Nordic Yards Wismar." (Press TV, "Iran, South Korea to launch shipbuilding JV," 12/5/15) 

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"None of the firms targeted are based in the United States. Only one name might appear familiar to American consumers: Hyundai Heavy Industries, the world's largest shipbuilder. However, that company has no connection to the similarly named automaker, said Jim Trainor, a spokesman for Hyundai Motor Co. The group United Against Nuclear Iran has criticized Hyundai Heavy Industries for its dealings with Iran and has faulted the Obama administration for failing to put it on the sanctions list." (The Baltimore Sun, "22 companies are listed for alleged Iran ties, sanctions," 9/17/2012)

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Hyundai Heavy Industries is the world's largest shipbuilder, with a 15% world market share. It also manufactures a variety of industrial, construction, and electrical equipment (Company Website). 

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Hyundai Heavy Industries has received numerous contracts to provide manufactured goods to Iran over the past six years. In 2004, HHI received an $18 million contract to provide construction equipment including excavators and wheel loaders to assist in the development of Iran's South Pars gas field. 

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In 2007, HHI received a $54 million contract to upgrade a refinery owned by the National Iranian Oil Engineering and Construction Co, a state-owned entity. And as recently as 2009, HHI received a contract to provide six high-pressure pump units to outfit an Iranian power plant.

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In 2005, HHI together with Daewoo Shipbuilding received a $1 billion contract from the state-owned National Iranian Oil Tanker Co to build 10 oil tankers (Bloomberg). At the contract’s issuance, NIOTC officials planned to order another 35 vessels for 2010; the status of this order is unknown. Each tanker is capable of carrying 2 million barrels of crude, providing a massive increase in shipping capacity for the Iranian petroleum industry.

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HHI owns a controlling stake in the Hyundai Corporation, a general trading company specializing in a wide variety of shipping, industrial, chemical, and electrical products. Hyundai Corp signed a $1.9 billion contract to provide Iran with materials “in the fields of shipbuilding, machinery, steel & metal, chemicals, home appliances, etc.” Hyundai Corp’s Tehran Office website contains a Major Products section, which contains a litany of sensitive products with wide applicability in the Iranian energy, petroleum, and even defense industries. This products include: oil tankers, LNG carriers, diesel engines, signaling systems, optical cables, conductor wires, high voltage cables, transmission cables, steel, aluminum, zinc, polypropylene, other chemicals, and consumer electronics.