Hanwha Aerospace (Hanwha Aerospace) is putting weight behind the ammunition market in Europe. The company has assigned executives as heads of its Poland and Germany teams within the relevant business unit. With ammunition in short supply worldwide and Poland and Germany sharply increasing defense spending, the move is seen as an attempt to focus on those markets.
According to the industry on the 19th, Hanwha Aerospace recently appointed executives as Heads of Team for the Poland and Germany task forces (TF) within the PGM division. As a result, Jeon Jin-cheol, head of the PGM Ground Systems Research Center at the PGM Research Institute, moved to become head of the Poland TF, and Kang Kyung-hoon, head of PGM Business Team 1, moved to become head of the Germany TF. Of the U.S., Germany, and Poland TFs launched in the first half of this year, only the Germany and Poland TFs have been elevated to executive-level organizations.
Hanwha Aerospace's PGM division develops and produces ammunition such as various guided weapons and modular charge systems (MCS). A propellant charge explodes behind a warhead to propel it, and an MCS is a cylindrical, modularized charge. The Germany and Poland TFs are said to be tasked with strengthening sales by identifying distribution channels for related products in each country.
A Hanwha Aerospace official said, "With ammunition in short supply worldwide due to the Russia-Ukraine war, we are actively responding to this demand," adding, "Poland and Germany are particularly important countries, and since we are still in the market penetration stage, we set up TFs and assigned executives." An industry official said, "Elevating them to executive-level organizations indicates the projects are being assessed as large-scale and that the company intends to make decisions more quickly," adding, "With improved efficiency, related businesses will likely gain speed."
Hanwha Aerospace does not disclose export performance by region, but as of last year it is estimated that about half of total exports came from Europe. Accordingly, Hanwha Aerospace is putting particular effort into the European market. Poland, where it established a joint venture with WB Group, the largest private defense company locally, is a prime example.
There, Hanwha Aerospace plans to produce an 80-kilometer-class guided missile to be mounted on Homar-K, the export model of the Chunmoo multiple rocket launcher. The plan is to supply Poland first and then expand to other countries in Europe.
Poland is pouring in massive funds, budgeting 200 billion zlotys (about 80.2 trillion won), equivalent to 4.8% of gross domestic product (GDP), for next year's defense spending. An industry official said, "Poland borders seven countries, and among them Belarus is Russia's most important ally," adding, "Poland is in a heightened state of crisis, believing it could be invaded by Russia at any time, and is staking everything on expanding its defense capabilities." For Hanwha Aerospace, which must expand its ammunition share in addition to its flagship products like the K-9 self-propelled howitzer, it is an optimal market. In the same vein, in Sep. it signed a memorandum of understanding (MOU) on ammunition technology research with the Military Institute of Armament Technology (WITU) in Poland.
Germany is also one of the markets Hanwha Aerospace keeps knocking on. Germany is home to major defense corporations such as Rheinmetall, which specializes in artillery, armored vehicles, and ammunition manufacturing, making it a difficult region for foreign companies to gain a foothold. However, like Poland, it is a market that cannot be missed, as defense expenditure is projected to increase from €95 billion this year to €162 billion in 2029.
An industry official said, "Germany's defense value chain has been significantly eroded, but it still remains a defense powerhouse with technology ahead of Korea," adding, "Because it is a market that is not easy to penetrate, it appears the company has empowered the effort by assigning executives."