TOTE Services has selected Hanwha Defense USA to build the U.S. Navy’s first landing craft medium (LSM) at Hanwha Philly Shipyard in a $269 million deal.
Press release from Hanwha Defense USA
ARLINGTON, Virginia, October 30, 2026 — Hanwha Defense USA (HDUSA) is the first shipbuilder selected by TOTE Services, a leading maritime services company specializing in ship construction management, to build a Landing Medium Ship (LSM) for the US Navy and Marine Corps under the TOTE Services Vessel Construction Manager (VCM) contract.
This selection marks HDUSA’s first contract to build ships for the US Navy and covers the construction of one LSM, valued at $269 million, at Hanwha Philly Shipyard, with options for three additional ships.
“Since acquiring Philly Shipyard in 2024, Hanwha has made significant investments in its workforce and technology to lead the way in building ships for the U.S. Navy and other federal customers.” said Michael Coulter, president and CEO of HDUSA. “PAE (Portfolio Acquisition Executive) Maritime has made it clear that this program is a priority for the U.S. Navy and Marine Corps, and Hanwha looks forward to working with TOTE Services to ensure on-time and on-budget delivery.” »
“This award shows how quickly the VCM model can move from tender to contract” said Jeff Dixon, President of TOTE Services. “Through a competitive process, we secured strong terms that benefit the government, as well as construction positions that allow construction to begin in the fourth quarter of 2027. We appreciate PAE Maritime’s commitment to the VCM acquisition model and commend the Navy’s leadership in rethinking how it delivers ships to the fleet. PAE Maritime has challenged the status quo and is removing long-standing barriers to execution. We are proud to support the Navy’s efforts to deliver critical capabilities faster and more efficiently.”
“Since the beginning of this year, HDUSA personnel have been in Philadelphia ensuring the shipyard is ready for naval work,” said Tim Glinatsis, HDUSA senior vice president of program management. “Hanwha Philly Shipyard has already built and delivered four multi-mission national security vessels under the VCM model with TOTE Services, and we will leverage this experience to deliver the LSM to the U.S. Navy and Marine Corps.
This week, HDUSA announcement it is in the process of acquiring a majority stake in Hanwha Philly Shipyard.
TOTE’ Services $2.2 billion VCM contract supports the Navy and Marine Corps’ planned 35-ship LSM fleet. The first ship in the program is expected to be delivered in 2030.
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Naval News comments:
The selection of the LSM program for Hanwha Philly Shipyard marks another critical execution milestone for the operationalization of Expeditionary Forward Base Operations (EABO) by the U.S. Navy and Marine Corps. The basic design of the LSM family is derived from LST 100 platform, parent company of Damen Shipyards—an approximately 4,000-ton beachable landing ship measuring approximately 100 meters in length, designed for shallow draft operations, direct beaching via forward doors/ramps, and optimized cargo throughput for rolling and rolling operations. The U.S. Navy’s key operational requirements for the platform include a minimum range of 3,400 nautical miles, a sustained speed of 15 knots, a non-reloading payload capacity for more than 500 tons of Marines and military equipment, and an aft flight deck capable of supporting helicopter and VTOL operations.
Hanwha’s entry into the construction plan follows the U.S. Navy’s strategy to operate multiple production lines under the Vessel Construction Manager (VCM) model managed by TOTE Services. This selection directly completes the initial contract awarded to Fincantieri Marinette Marine in April 2026which ensured long-term material supply and production preparation for the initial tranche of ships. Distributing LSM construction to established commercial shipyards like Hanwha Philly Shipyard and Fincantieri is critical for the Navy to achieve its ambitious goal of a 35-ship fleet while keeping individual ship costs low and avoiding capacity bottlenecks at traditional Tier 1 shipyards.
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