K-TIG signs deal with major international military manufacturer Hanwha

K-TIG ASX KTG Hanwha Defense Australia armoured vehicles South Korea
K-TIG will develop advanced keyhole welding procedures for the Australian Army’s preferred supplier of its multibillion-dollar self-propelled artillery project.

Welding specialist K-TIG (ASX: KTG) has inked a deal with international defence manufacturer Hanwha Defence Corporation and Hanwha Defence Australia Pty Ltd to develop welding technology to help build Australia’s next generation of armoured vehicles.

Hanwha is one of South Korea’s largest military manufacturers and is the preferred supplier for the Australian Army’s multibillion-dollar Land 8116 self-propelled artillery project. It has also been shortlisted for the Land 400 Phase 3 Infantry Fighting Vehicle project.

In the first phase of the army’s Protected Mobile Fires project, Hanwha will build and assemble its Huntsman self-propelled howitzer and supporting systems in Australia with a budget estimated at up to $2.6 billion.

Under a newly signed memorandum of understanding (MoU), K-TIG will develop procedures and demonstrate its ability to weld advanced steels for military vehicles in the joint geometries applicable to the Huntsman.

“Partnering with Hanwha to create crucial equipment for Australia’s defence is a significant opportunity for K-TIG to deploy the speed, efficiency and effectiveness of our advanced keyhole welding technology, all while helping to create local jobs, develop strategically vital manufacturing skills for the nation, and provide the Australian Army with the self-propelled artillery capability it’s desired for many years,” K-TIG managing director Adrian Smith said.

Building the Huntsman

K-TIG will develop automatic welding procedures for manufacturing Hanwha’s Huntsman system in Geelong, Victoria.

A total of 60 self-propelled artillery systems are lined up for local production plus 15 ammunition supply vehicles and their support systems. Combined with ongoing maintenance, this represents a major pipeline of future work, K-TIG said.

The company secured the deal with Hanwha following a successful demonstration of its “industry disrupting” high-speed precision technology, which can weld up to 100 times faster than traditional tungsten inert gas (TIG) welding.

K-TIG’s capabilities have also been demonstrated through the recent establishment of operations in the US and its partnerships with local defence manufacturers (including Bisalloy Steel and Axiom Precision Manufacturing) to create sovereign manufacturing capabilities.

Earlier this month, Axiom received a $1 million federal government grant to fast-track deployment of K-TIG’s specialised welding equipment into its defence manufacturing facility near Adelaide, South Australia.

Another defence project potentially in the pipeline

Hanwha is also on the shortlist to become the preferred tenderer for the Australian Army’s Land 400 Phase 3 project to create a new infantry fighting vehicle. This major contract is estimated to be worth between $18-27 billion.

K-TIG confirmed its welding technology is being evaluated as an “integral part” of Hanwha’s plans for this project.

Terms of the deal

The terms of the non-binding MoU, announced today, state that Hanwha Defence Australia will supply the armoured steel coupons to be used in the development of the Hanwha-specific welding protocols, while K-TIG will supply samples of the coupons welded in the agreed geometries for independent testing of weld quality.

Hanwha Defence Corporation will provide technical data relating to the development of welding protocols and any related support systems.

The indicative timeline for the project is estimated at 24 weeks, K-TIG said.

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