HDW was founded October 1, 1838 in Kiel at the Bay of Kiel of the Baltic Sea by the engineer August Howaldt and the Kiel entrepreneur Johann Schweffel under the name Maschinenbauanstalt und Eisengießerei Schweffel & Howaldt, initially building boilers. The first steam engine for naval purposes was built in 1849 for the Von der Tann, a gunboat for the small navy of Schleswig-Holstein. In 1892 the company started a subsidiary in Austrian-Hungarian Fiume on the coast of the Adriatic Sea. The activity was closed down by the company in 1902. The shipyard still exists, today under the firm 3. Maj.