Home Technical DSME squares off with HD HHI over preferred Bidder Selection Process

DSME squares off with HD HHI over preferred Bidder Selection Process

South Korea’s first Aegis destroyer, the Sejong, delivered by Hyundai Heavy Industries in 2008

Competition is heating up between Daewoo Shipbuilding & Marine Engineering, which will become an affiliate of Hanwha Group later this month, and HD Hyundai Heavy Industries.

On April 19, DSME submitted a request to the Korean Board of Audit and Inspection to audit whether there was any illegality or irregularity in the process of selecting a contractor that picked HD HHI as the preferred bidder to build the next Korean destroyer.

“The results of a trial revealed that HD HHI had secretly photographed and stolen Daewoo Shipbuilding’s KDDX conceptual design materials during the selection process for a KDDX basic design in 2020 and systematically concealed them in its internal server,” DSME said in its request. “At that time, the fairness of the business selection process was seriously undermined by selecting HD HHI as the preferred bidder.”

HD HHI was not penalized in the evaluation for the security-breaching incident. As a result, the difference in scores between DSME and HD HHI was only 0.0565 points, according to DSME. If a penalty for the security mishap had been imposed, the outcomes of the evaluation would have become totally different, DSME claims.

“HD HHI claimed that it did not use stolen secrets when bidding for the KDDX Project. But the court found HD HHI’s claim to be not true,” DSME said, emphasizing that DSME made the audit request as it believed that it was needed to review the appropriateness of the preferred bidder selection process.

HD HHI, however, called into question why DSME reopened the case that had been closed by the court. “DSME’s story that the fairness of the contractor selection process was destroyed is far from being true as the matter has already been judged by the court and the Defense Acquisition Program Administration,” said an HD HHI official, adding, “The court already dismissed DSME’s claim, saying that it was groundless.”

Source: BusinessKorea

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