Canada is in negotiations to purchase up to twelve submarines from German shipbuilder ThyssenKrupp Marine Systems (TKMS), as Prime Minister Mark Carney announced the conclusion of a fierce competition to replace the aging Victoria-Class submarine fleet. The bids from South Korea with Hanwha Ocean and Germany and Norway with TKMS not only included submarine procurement but also significant investments in Canada’s economy.
TKMS proposed delivering four Type 212CD submarines to the Royal Canadian Navy by 2036, with the first submarine expected by 2034. This matches the South Korean bid, which also offered to deliver four submarines by 2035. The timing is critical as Canada’s current fleet is set for retirement in the mid-2030s, with only one operational submarine at present.
Prime Minister Carney emphasized the importance of the decision, stating that both TKMS and Hanwha platforms met the Royal Canadian Navy’s high capabilities. Canada’s selection of the TKMS bid initiates negotiations for the potential procurement of up to twelve submarines.
As part of the deal, TKMS has committed to providing economic benefits to Canada equal to 100% of the government’s investment value. This is expected to result in tens of billions of dollars in investments across various defense and industrial sectors, creating over 100,000 well-paying jobs in the country.
The German bid aligns with Canada’s economic goals, including expanding LNG production and creating jobs. The proposal includes establishing maintenance facilities, manufacturing centers for torpedoes, and investing in carbon capture technology in partnership with Alberta.
Furthermore, the TKMS submarines are designed to be fully compatible with NATO forces, enhancing Canada’s ties with the alliance. The deal with Germany also complements Canada’s existing agreements, such as a recent deal to export LNG.
The announcement is anticipated to bring substantial economic activity to Halifax and the West Coast, with benefits extending throughout the country. Carney emphasized that the selection of the German bid does not detract from Canada’s Indo-Pacific strategy, with Hanwha remaining as the reserve supplier if negotiations with TKMS falter.