Canada has selected German shipbuilder ThyssenKrupp Marine Systems as its preferred supplier for a major submarine procurement plan that could involve up to 12 new vessels for the Canadian Navy. The decision marks one of the country’s most significant defence modernisation moves in decades and comes as Ottawa works to expand its military capability, strengthen its presence in the Arctic and meet higher defence-spending commitments linked to NATO.
The announcement was made as Canada prepared for international security discussions and growing pressure among NATO allies to improve defence readiness. The submarine project is expected to replace Canada’s aging Victoria-class submarines, which have faced maintenance challenges and operational limitations for years. Canada has been examining options for a modern fleet capable of operating over long distances, including in Arctic waters, the Atlantic Ocean and the Pacific region.
The preferred supplier, TKMS, is known for building conventional submarines for several countries. The company was competing with South Korea’s Hanwha Ocean for the Canadian contract. While the final agreement, construction timeline and full cost details are still expected to be negotiated, the selection of TKMS gives the German company a major advantage in securing the future deal.
According to reports, Canada is considering a fleet of up to 12 submarines, a number that would substantially increase the country’s ability to maintain patrols and conduct training, surveillance and defence operations. A larger fleet would allow Canada to have more vessels available while others undergo maintenance or upgrades.
The move is closely connected to Canada’s changing security environment. The country has one of the world’s longest coastlines and shares responsibility for monitoring vast waters in the Atlantic, Pacific and Arctic regions. As melting ice creates more accessible shipping routes in the Arctic, Canada and other Arctic nations are paying greater attention to maritime security, sovereignty and military activity in the region.
Canada’s Arctic is also becoming more strategically important because of rising interest from global powers. Increased shipping, natural-resource exploration and military movement have made the region a larger part of international defence planning. Modern submarines could provide Canada with improved surveillance capability in difficult waters and support its broader role in protecting northern territory.
Prime Minister Mark Carney has placed defence investment high on the government’s agenda, especially as NATO members face expectations to spend at least 2% of their gross domestic product on defence. Canada has faced criticism in previous years for spending below the alliance target, but the government has moved to accelerate military investments.
The submarine decision is part of a wider effort that includes upgrades to naval capabilities, Arctic surveillance, defence infrastructure and cooperation with allied countries. Canada has also been working on plans related to aircraft procurement, cyber security, military equipment and the strengthening of continental defence with the United States.
The Canadian Navy currently operates four Victoria-class submarines, which were originally built for the United Kingdom’s Royal Navy and later acquired by Canada. The vessels have provided Canada with underwater defence capability, but their age and maintenance requirements have led to concerns about reliability and long-term readiness.
Replacing the fleet is considered essential because submarine projects take many years to complete. Designing, building, testing and commissioning a new submarine can require a decade or longer. Defence planners therefore need to begin procurement decisions early to avoid a gap in capability when older vessels are retired.
The new submarines are expected to be conventionally powered rather than nuclear-powered. Conventional submarines are generally less expensive to operate and do not require nuclear infrastructure, although they may have limitations compared with nuclear submarines in terms of endurance and speed. Canada has not operated nuclear submarines and has historically focused on conventional naval technology.
TKMS has experience in producing submarines designed for long-distance missions and has supplied naval platforms to several countries. The company’s proposal is expected to include technology transfer, industrial cooperation and opportunities for Canadian companies to participate in maintenance, supply chains and long-term support.
Such arrangements are important for Canada because the government wants defence contracts to support domestic jobs and technical capability. A project of this size could create opportunities for shipyards, engineering firms, software companies, defence suppliers and training institutions across the country.
The final contract could become one of the most expensive military procurement programs in Canadian history. Large submarine programs often cost tens of billions of dollars when construction, weapons systems, training, maintenance and long-term operations are included. Canadian officials will likely face detailed questions about affordability, timelines and whether the project can avoid the delays that have affected previous defence procurement plans.
Canada has experienced major delays and cost increases in past military projects, including naval shipbuilding and aircraft replacement programs. Because of this history, the government will be under pressure to provide clear information about the submarine procurement process and ensure that taxpayers receive value for money.
The selection of a German supplier also highlights Canada’s growing defence relationship with European partners. NATO countries are increasing cooperation on military technology, supply chains and regional security as concerns grow over conflicts, cyber threats and geopolitical competition.
For Germany, the possible Canadian contract would be a major international success for its naval industry. European defence companies have been seeking new export opportunities as governments across NATO increase military budgets. A Canadian deal could strengthen Germany’s position as a supplier of advanced conventional submarines.
The decision may also have implications for Canada’s relationship with South Korea. Hanwha Ocean had been considered a strong contender and has been expanding its global defence business. South Korea has become an increasingly important supplier of military equipment, ships and technology to allied nations.
While TKMS has been named the preferred supplier, the procurement process is not complete. Canada will need to negotiate final terms, confirm financing, determine construction schedules and decide how much of the work will be completed in Canada. Parliament, defence experts and the public will closely watch the process because of the project’s scale and importance.
The submarine plan reflects a broader shift in Canada’s approach to defence. For many years, Canada relied heavily on alliances and focused more on peacekeeping and limited overseas missions. Today, the country is facing a more complex global environment involving Arctic competition, maritime security concerns, cyber threats and pressure from allies to contribute more to collective defence.
A modern submarine fleet would give Canada a stronger role in monitoring its waters and supporting NATO operations. It would also provide the country with a strategic capability that few nations possess, allowing naval forces to operate quietly and gather intelligence in areas where surface ships may be more visible.
As negotiations move forward, the key question will be whether Canada can turn the preferred supplier decision into a reliable, affordable and long-term defence program. The project will likely shape the Canadian Navy for several decades and influence how Canada responds to security challenges in the Arctic and beyond.