LIG Nex1 has been selected to lead South Korea’s next-generation Cheongung-3 surface-to-air missile development project, edging out rival Hanwha in a competitive bid for what is being described as a cornerstone of the country’s future air defense strategy.
According to information confirmed by the defense industry on July 28, the Defense Acquisition Program Administration (DAPA) designated LIG Nex1 as the primary contractor for eight of nineteen key components tied to the Cheongung-3 program.
The program is valued at approximately 2.83 trillion won ($2 billion) and is expected to field a completed system by 2034.
The Cheongung-3 is considered a major evolution over the Cheongung-2, with engagement capabilities five times broader and a defended area four times larger, according to industry officials. Often referred to domestically as the “Korean Iron Dome,” the Cheongung-3 will play a central role in Seoul’s expanding multi-layered missile defense architecture.
Company says the award includes full system integration responsibilities and the development of the interceptor missiles and engagement control centers. In the missile category, LIG Nex1 secured the contract by a margin of just 0.1 points over Hanwha Aerospace. Hanwha Systems, which attempted to expand into fire-control systems, also lost out to LIG Nex1 in that area.
The Cheongung-3 is designed to respond to increasingly diverse missile threats from North Korea and beyond. Unlike the Cheongung-2, which focused on short- to medium-range threats, Cheongung-3 is being engineered with advanced intercept capabilities to defend against complex aerial attacks, including maneuvering targets.
While LIG Nex1 secured a majority of the high-profile tasks, Hanwha retained several core responsibilities from the Cheongung-2 program. This includes development of the multi-function radar, launcher, and propulsion system. In the launcher category, Hanwha Aerospace held off LIG Nex1 by 0.7 points.
Additional components were awarded to mid-sized companies including Doowon Heavy Industries for airframe structures, Vitzrocell for thermal batteries, and Danam Systems for flight data recorders.
The rivalry between LIG Nex1 and Hanwha is intensifying across South Korea’s broader defense modernization push. On the same day as the Cheongung-3 announcement, DAPA also awarded the $380 million contract to upgrade the Jangbogo-II (Type 214) submarines to a team led by HD Hyundai and LIG Nex1—beating out Hanwha Ocean and Hanwha Systems. Defense sources say LIG Nex1’s domestically developed sonar suite played a decisive role in securing the contract.
In upcoming projects, both firms are again expected to compete. DAPA is preparing to launch a 1.77 trillion won program for electronic warfare aircraft by 2034, with Korean Air and LIG Nex1 forming one team, while Korea Aerospace Industries (KAI) and Hanwha Systems lead the other.
Another major project looming is the L-SAM-II system, described as South Korea’s version of the Terminal High Altitude Area Defense (THAAD) system. The L-SAM-II will be designed to intercept targets at altitudes between 40 and 150 kilometers, and both industrial coalitions are positioning for roles in the program.
LIG Nex1 has been South Korea’s lead developer of domestic air defense missile systems since the 1985 launch of the national defense specialization program. Hanwha, traditionally focused on ballistic missiles, has expanded into air defense since the program’s end in 2008, following several acquisitions in the 2010s.