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Busan Metropolitan City Selected for “Defense Innovation Cluster Naval Vessel MRO Project”… Establishes Foundation to Become a Global Naval Maintenance Hub

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Busan Metropolitan City, led by Acting Mayor Kim Kyung-duk, announced that it has been finally selected for the “Defense Innovation Cluster Naval Vessel MRO* Project” public contest hosted by the Defense Acquisition Program Administration.

This achievement follows Busan’s selection in April for the Ministry of Trade, Industry and Energy’s “Support Project for Strengthening Global Competitiveness in Small and Medium Shipbuilding Naval Vessel MRO,” enabling the city to complete a naval vessel MRO growth framework that mutually links and complements the ministry’s “business support and workforce development” track with the Defense Acquisition Program Administration’s “infrastructure establishment and technology development (R&D)” track.

• ●Naval Vessel Maintenance, Repair, and Overhaul (MRO): A comprehensive term referring to maintenance, repair, and improvement activities carried out throughout the lifecycle of naval vessels to maintain performance and extend service life.

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The Defense Innovation Cluster Naval Vessel MRO Project will be carried out over five years from 2026 to 2030 with a total project budget of KRW 49 billion (KRW 24.5 billion from the national government, KRW 5 billion from Busan Metropolitan City, and KRW 19.5 billion from other local governments). The project will be jointly promoted by Busan, Ulsan, Gyeongsangnam-do, and Jeollanam-do, the largest concentration area for naval vessel MRO supply chains.

The Defense Technology Promotion Research Institute, serving as the dedicated agency, plans to separately select the implementing organization through a public contest.

Based on preliminary demand surveys conducted among companies, Busan Metropolitan City plans to focus on establishing naval vessel MRO infrastructure, technology development (R&D), and business support projects.

In particular, the project plan was designed to reflect on-site demand from repair shipbuilding and ship equipment companies in Yeongdo-gu and Saha-gu, including HJ Shipbuilding & Construction.

The city plans to establish a “Naval Vessel MRO Defense Quality Certification Center” in the Gangseo-gu area of Busan to secure the reliability of core components and support quality certification for related companies.

In addition, centered on the Quality Certification Center, the city plans to promote the development of AI-based PAUT* inspection robots for MRO applications, development of innovative products and discontinued parts, localization of components, and consulting services for U.S. Navy ship maintenance qualifications (MSRA) and cybersecurity certification for U.S. naval vessels (CMMC), thereby strengthening the competitiveness of regional shipbuilding and defense SMEs.

• ●PAUT Inspection: Smart non-destructive testing equipment equipped with phased array ultrasonic testing (PAUT) sensors.

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Furthermore, the project is expected to comprehensively support the government’s K-Shipbuilding vision and the MASGA (Make American Shipbuilding Great Again) project, a key initiative of the Korea-U.S. shipbuilding alliance, while serving as a foundation for proactively responding to the rapidly changing restructuring of the Northeast Asian naval vessel MRO supply chain.

Busan Metropolitan City plans to swiftly complete preliminary procedures, including the local fiscal impact assessment, within May, and finalize the establishment of the project group and agreements with implementing organizations by July in order to launch the project in the second half of this year.

Through this project, the city also plans to transform the regional shipbuilding industry from one centered on simple repair and maintenance into a high-value-added MRO defense industry. Furthermore, it intends to actively pursue the attraction of the “Defense Innovation Cluster Advanced National Defense Strategic Industry Project,” which is expected to lead the future of the Republic of Korea.

Busan Metropolitan City has also applied for the “2026 Defense Innovation Cluster Advanced National Defense Strategic Industry Public Contest Project” hosted by the Defense Acquisition Program Administration and the Defense Technology Promotion Research Institute.

Leveraging its concentration of military assets including the Republic of Korea Fleet Command, marine research infrastructure, and companies possessing outstanding defense technologies, Busan aims to establish a full-cycle marine defense AI transformation (AX) ecosystem and develop itself into a marine defense industry hub driven by AI technologies through the attraction of the Defense Innovation Cluster project in the advanced national defense strategic industry sector.

Acting Mayor Kim Kyung-duk of Busan Metropolitan City stated, “This selection by the Defense Acquisition Program Administration is the result of the city’s continuous efforts based on the urgent demand from the regional shipbuilding industry, including HJ Shipbuilding & Construction,” adding, “We will maximize the synergy between the Ministry of Trade, Industry and Energy project and the Defense Acquisition Program Administration project to preemptively secure the defense export supply chain to the United States and foster the naval vessel MRO industry as one of Busan’s future advanced strategic industries.”