Canada’s plan to purchase up to twelve submarines from German shipbuilder ThyssenKrupp Marine Systems (TKMS) was revealed by Prime Minister Mark Carney, concluding a fierce competition to replace the aging Victoria-Class fleet. Both bids, one from South Korea with Hanwha Ocean and the other from Germany and Norway with TKMS, included commitments to make significant investments in Canada’s economy.
TKMS proposed to supply four Type 212CD submarines to the Royal Canadian Navy by 2036, with the first submarine expected by 2034. This offer closely matched South Korea’s bid to deliver four submarines by 2035. The timing aligns with the retirement schedule of Canada’s existing fleet, with only one operational submarine currently.
In a significant economic move, Carney stated that the deal requires 100% of the federal government’s investment value to be matched by economic benefits to Canada. The agreement with TKMS is anticipated to bring in billions of dollars in investment across various sectors, creating over 100,000 well-paying jobs nationwide.
The German proposal includes plans for a maintenance facility on the Canadian coast and the establishment of manufacturing centers for torpedoes and anti-torpedo systems. Additionally, Manitoba’s Port of Churchill could be transformed into a key export hub for Canadian liquefied natural gas and critical minerals.
The selection of TKMS builds deeper ties with NATO forces as the company is already a supplier for the alliance. The submarines are designed for Arctic waters and NATO interoperability, allowing seamless communication and joint missions. The deal also aligns with Canada’s economic goals, including increasing LNG production to 50 million tonnes annually by 2030.
Carney emphasized that opting for the German bid does not shift Canada away from its Indo-Pacific strategy, with South Korea remaining as the backup supplier. The potential benefits from this procurement are expected to extend to various regions of Canada, particularly impacting Halifax and the West Coast with substantial shipbuilding and economic activities.
The negotiations with TKMS mark a significant milestone in Canadian defense procurement history, promising economic growth, job creation, and enhanced naval capabilities for the country.