Hanwha Defense USA, the American subsidiary of Hanwha Aerospace, has reached an agreement to build a large-scale ammunition factory on a U.S. Army base.
On Thursday, Hanwha Defense USA announced it had signed a preliminary agreement with the U.S. Army to construct a new ammunition facility at Pine Bluff Arsenal in Jefferson County, Arkansas.
The coming months will see final negotiations and due diligence, with the total investment reaching 1.3 billion USD.
This facility will produce critical propellants that enhance the performance and reliability of major weapon systems, including 155mm howitzers. These key propellants – nitrocellulose, nitroglycerin, and nitroguanidine – are commonly known as triple-base propellants and are primarily used in long-range high-explosive shells and artillery, naval guns, and tank ammunition.
Through this facility, Hanwha aims to address the U.S. Army’s longstanding shortage in energy material production capabilities.
In a Wall Street Journal (WSJ) interview on Tuesday, U.S. Army Assistant Secretary Brent Ingraham stated that these propellants could be used in various tank munitions and drone armaments, including the 155mm shells supplied to Ukraine. He expressed optimism that Hanwha’s ammunition factory would stabilize the ammunition supply chain for U.S. forces and allies.
Michael Coulter, CEO of Hanwha Defense USA, expressed gratitude for the U.S. Army’s trust in Hanwha and pledged to further strengthen America’s arsenal for freedom.
The WSJ reported that this contract aligns with the Pentagon’s efforts to increase land utilization within military installations.
U.S. Army Assistant Secretary William Jordan Gillis announced plans to begin negotiations with Hanwha to finalize an enhanced use lease agreement that allows the strategic use of underutilized land on military bases to meet various operational needs.
Analysts suggest that Hanwha was selected as the U.S. Army’s final partner because of its superior ability to rapidly deliver modern military facilities compared with domestic American firms.
Notably, while the factory will prioritize commercial production during peacetime, it can swiftly transition to wartime production under Pentagon control if necessary. This positions the facility as a potential supply hub for U.S. allies and NATO.