Canada has named Germany’s ThyssenKrupp Marine Systems (TKMS) as the preferred supplier for up to 12 submarines, a move Prime Minister Mark Carney described as the country's largest-ever military procurement. This decision precedes Carney's attendance at an upcoming NATO summit where allies are expected to reaffirm commitments to higher defense spending.
Carney stated that the TKMS platform is well-suited for Arctic conditions and NATO operations. "The submarine is proven and capable," he said, highlighting that TKMS already supplies submarines to over a third of NATO members. Negotiations for a final contract are set to begin, though the total cost, expected to be in the "tens of billions of dollars," was not disclosed.
German Chancellor Friedrich Merz welcomed the decision as a "strong signal for our transatlantic and European partnership." TKMS was selected over South Korea's Hanwha Ocean, with the German company emphasizing that its conventionally powered vessels would enhance interoperability among NATO allies already operating similar systems.
The procurement aligns with Canada's pledge to significantly increase military spending. Carney aims to raise defense expenditures to 5% of gross domestic product by 2035, an acceleration from the nation's recent achievement of NATO's previous 2% target. Canada's fiscal plan already projects defense spending to reach 4% of GDP by 2030, ahead of NATO's timeline.
To expedite delivery, Germany and Norway, who jointly designed the submarines, will allocate production slots to Canada. This arrangement is expected to allow Canada to receive four submarines by 2034, two years earlier than initially projected by TKMS. The new fleet will replace Canada's four aging Victoria-class submarines, acquired secondhand from the United Kingdom in the late 1990s.
No U.S. companies bid on the contract, as American shipyards exclusively build nuclear-powered submarines, while Canada sought diesel-electric, conventionally powered vessels. "The sovereignty of our country, bounded by the three oceans and the world’s longest coastline, depends on our maritime capabilities," Carney emphasized.