South Korea and the U.S. to Build Navy Underwater Drone Swarms to Counter China in Indo-Pacific.

South Korea’s Hanwha Group and U.S.-based Vatn Systems have reached an agreement to co-develop low-cost autonomous underwater drones for the U.S. Navy. The effort supports Washington’s push for mass scalable undersea systems that can offset China’s rapid expansion in the Indo-Pacific.

According to Reuters on December 10, 2025, South Korea’s Hanwha Group and U.S. startup Vatn Systems agreed to jointly develop autonomous underwater drones for the U.S. Navy as part of a broader push to counter China’s expanding maritime presence in the Indo-Pacific. The deal builds on Hanwha’s recent investment in a 60 million dollar funding round for Vatn and targets the rapid fielding of low-cost torpedo-shaped vehicles that can conduct both surveillance and strike missions.
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Hanwha and U.S. startup Vatn advance a new generation of low-cost autonomous underwater drones, combining Korean naval manufacturing strength with American swarm technology to deliver rapid deployable undersea effectors for future U.S. and ROK Navy operations (Picture source: Vatn Systems). 

At the heart of the partnership is Vatn’s Skelmir S6, described by the company as a Compact Modular Underwater Effector. The man-portable drone weighs roughly 50 to 60 pounds, measures just 6 inches in diameter, and can carry a 10 to 20 pound payload. It sprints at up to 20 knots, with a range of about 20 nautical miles and an operating depth around 100 meters, trading exquisite endurance for speed and numbers.

The S6 is explicitly designed as expendable mass. Vatn’s mission software allows a single operator using an Android Tactical Assault Kit plug-in to plan and monitor hundreds of vehicles at once, giving commanders a swarm of autonomous effectors they can launch from shore, small boats, submarines, surface combatants, or even aircraft. The platform can accept kinetic warheads, electronic warfare or cyber payloads, and a variety of sensor packages without demanding deep integration with host vessels.

Cost is central to its operational logic. The S6’s unit price is estimated at roughly 75,000 dollars, a fraction of the multimillion-dollar figures associated with larger autonomous undersea systems. In practice, that means a carrier strike group or Marine littoral regiment could saturate chokepoints with dozens of Skelmir swarms, creating mine-like ambush zones, screening high-value units, or hunting enemy submarines with attritable sensors and torpedoes.

Hanwha brings something very different to the table: the conglomerate is already a prime supplier of submarines, mine countermeasure systems, and unmanned maritime vehicles for the Republic of Korea Navy, including autonomous surveillance AUVs and large anti-submarine UUV concepts built around open architectures and swarm control. Its experience integrating unmanned platforms into naval combat systems, plus shipyard capacity in both Korea and the United States following its acquisition of Philly Shipyard, positions Hanwha as the industrial backbone that can scale Vatn’s small batch innovation into fleet-level production.

For Washington, the attraction is obvious. The Pentagon’s Replicator initiative calls for attritable autonomous systems at a scale of multiple thousands across domains to blunt China’s numerical advantage. Skelmir style swarms fit that concept almost perfectly: cheap, fast, hard to track, and survivable in GPS-denied, jammed littorals where traditional submarines and crewed patrol craft are increasingly vulnerable. Adding Hanwha as a co-producer also diversifies the U.S. undersea industrial base and anchors a key ally inside emerging autonomy supply chains.

Seoul gains just as much. Joint production of Skelmir-based systems plugs Hanwha directly into American undersea weapons programs and accelerates technology transfer in autonomy software, networking, and U.S. Navy certification standards. The same effector family can be adapted for Korean requirements, from mine hunting and port defense in the Yellow Sea to layered anti-infiltration barriers around major naval bases, complementing Hanwha’s larger ASW UUVs and mine warfare USVs.

China has already sanctioned Hanwha after its expansion into the U.S. shipbuilding sector, and the decision to deepen underwater drone cooperation with Washington signals that Seoul is prepared to absorb that pressure in exchange for a tighter defense industrial alliance. For the United States, putting allied branding and capital on an emerging weapons family strengthens deterrence messaging and makes it easier to field the same systems with partners across the Indo-Pacific.

The Hanwha Vatn agreement is worth watching as a prototype of future undersea armaments: small, fast, software-defined effectors produced in the thousands rather than the dozens. If the partnership delivers, Skelmir swarms could become a standard tool for U.S. and Korean naval commanders seeking to create an underwater hellscape of attritable drones that complicate any Chinese move from the Taiwan Strait to the Sea of Japan.