The first submarines Canada has ever ordered brand-new
In a decision that speaks as much to geopolitics as to naval strategy, Canada has chosen Germany's ThyssenKrupp Marine Systems to build twelve new submarines — the first brand-new vessels the Royal Canadian Navy has ever ordered. The contract, worth over twelve billion dollars and potentially seventy billion when maintenance is included, reflects Canada's deepening orientation toward European alliances and its growing determination to assert sovereignty over Arctic waters. It is a moment in which a nation, long reliant on secondhand equipment and American partnerships, begins to write a different chapter of its own defence story.
- Canada's four aging British submarines — three of them currently in maintenance — have left the Royal Canadian Navy stretched thin across some of the world's most strategically sensitive waters.
- The competition between Germany's TKMS and South Korea's Hanwha was genuinely fierce, with Hanwha spending millions on advertising and promising Canadian steel and jobs, while Germany countered with NATO compatibility and broader industrial partnerships.
- The Arctic is the quiet protagonist of this deal: the new submarines are designed for stealth and extended surveillance in contested polar routes that climate change and rival powers are making increasingly consequential.
- Canada's pivot is larger than one contract — it is simultaneously weighing Swedish Gripen jets and has already committed to F-35s, signalling a deliberate effort to diversify away from American military dependence.
- The deal is not yet final; formal negotiations between Ottawa and ThyssenKrupp must still be concluded, a process that could unfold over years even as NATO allies announce billions in coordinated new defence spending.
Canada has selected German shipbuilder ThyssenKrupp Marine Systems to construct twelve new submarines, marking one of the most consequential defence purchases in the country's history. Prime Minister Mark Carney announced the decision on Monday, ending a months-long competition that also featured South Korea's Hanwha Ocean. The contract is valued at over twelve billion dollars, with lifetime maintenance costs potentially pushing the total beyond seventy billion.
The Royal Canadian Navy currently operates four submarines, all bought secondhand from Britain in 1998 and three of which are presently in maintenance. These twelve vessels will be the first submarines Canada has ever ordered new — a symbolic as much as strategic departure. Built around stealth technology, the German submarines are designed for extended surveillance in contested waters, with the Arctic firmly in mind. As climate change opens new shipping routes and rival powers increase their presence in the region, Canada's ability to monitor and assert sovereignty over passages like the Northwest Passage has become a pressing priority.
The South Korean bid was formidable. Hanwha offered larger submarines capable of heavier armament and deeper ocean patrols, and mounted an aggressive campaign that included celebrity-voiced advertising and promises to source Canadian steel from Sault Ste Marie. Germany's pitch leaned on NATO interoperability and hinted at broader economic partnerships spanning rare earths, artificial intelligence, and battery technology — an appeal that resonated with Canada's stated goal of diversifying its defence and industrial relationships.
Carney personally visited both shipyards before making his decision, touring ThyssenKrupp's facility in Kiel and inspecting a completed submarine at Hanwha's yard in South Korea. The choice fits within a wider reorientation of Canadian defence policy: the government has committed to reaching five percent of GDP in military spending by 2035, recently crossed the NATO two percent threshold, and is weighing the purchase of seventy-two Swedish Gripen fighter jets alongside its existing order of eighteen American F-35s. Political friction with Washington has accelerated Ottawa's interest in European alternatives. Formal contract negotiations with ThyssenKrupp are still to come, a process expected to take years.
Canada has chosen a German shipbuilder to construct twelve new submarines in what amounts to one of the country's most significant defence purchases on record. Prime Minister Mark Carney announced the decision on Monday, selecting ThyssenKrupp Marine Systems over a South Korean competitor in a competition that stretched across months and involved high-stakes pitches from both sides.
The choice matters partly because of what it says about Canada's military future and partly because of what it signals about the country's geopolitical alignment. The Royal Canadian Navy currently operates four submarines, all purchased secondhand from Britain in 1998. Three of those four are currently in maintenance. The new vessels will be the first submarines Canada has ever ordered brand-new rather than acquiring used equipment from another nation. The contract itself is valued at more than twelve billion US dollars, but when you factor in roughly fifty years of maintenance and support, the total cost could exceed seventy billion dollars.
ThyssenKrupp's submarines are built around stealth technology designed to operate in contested waters with minimal detection. For Canada, that capability points toward a specific strategic priority: the Arctic. The new vessels will be able to conduct extended surveillance missions across key Arctic routes, including the Northwest Passage, giving Canada a stronger military presence in a region that has become increasingly contested as climate change opens new shipping lanes and as rival powers expand their activities there.
The competition between the two bidders was fierce and genuinely close. South Korea's Hanwha Ocean offered submarines that were substantially larger than the German design, which would have given Canada greater capacity to deploy heavy weapons and conduct extended patrols in deep ocean. Hanwha also mounted an aggressive campaign to win the contract, spending millions on advertising that included a voiceover from prominent Canadian journalist Peter Mansbridge. The company promised to use steel from Algoma's plant in Sault Ste Marie, Ontario, to manufacture armoured military vehicles in Canada, framing the deal as an economic opportunity for Canadian industry.
German officials, by contrast, emphasized compatibility with NATO and the broader alliance ecosystem. It has been reported that ThyssenKrupp was hoping to expand the scope of negotiations beyond submarines to include possible investments in rare earths mining, artificial intelligence, and battery production for the automotive sector. That pitch aligned with a larger Canadian strategy: the country has signalled it wants to diversify its defence partnerships and reduce its reliance on American suppliers.
Carney himself visited both facilities before the decision. He toured ThyssenKrupp's shipyard in Kiel, Germany, and inspected a newly completed submarine at Hanwha's facility in Geoje, South Korea. Senior officials from both countries made their own pilgrimages to Canada to make their cases directly to government decision-makers.
The submarine purchase sits within a broader reorientation of Canadian defence spending. The Liberal government has committed to dramatically increasing military expenditure, with a target of allocating five percent of gross domestic product to defence by 2035. Canada recently announced it had reached the two percent NATO target, a longstanding benchmark for alliance members. At the same time, the country is exploring other major weapons purchases from European manufacturers. It is weighing the acquisition of seventy-two Swedish-made Gripen fighter jets, a deal that could create more than twelve thousand jobs in Canada. The country has already committed to buying eighteen American-made F-35 jets, but recent political tensions between Canada and the United States have prompted Ottawa to look elsewhere for additional air force modernization.
The submarine contract still requires formal negotiations between the Canadian government and ThyssenKrupp to finalize the terms, a process that could take years. NATO Secretary General Mark Rutte told reporters on Monday that alliance members were about to announce billions in new defence contracts, describing them as the essential equipment needed to deter and defend against emerging threats.
Notable Quotes
The crucial kit we need to deter and defend— NATO Secretary General Mark Rutte, describing the wave of new defence contracts being announced by alliance members
The Hearth Conversation Another angle on the story
Why did Canada choose the German submarines over the South Korean option? They sound like they offered more firepower.
They did offer more raw capability in some ways. But Canada was thinking about something different—alignment with NATO, industrial partnerships beyond just submarines, and a design optimized for Arctic operations rather than deep-ocean power projection. The German choice was partly strategic, partly political.
What's the Arctic angle? Why does that matter so much?
Climate change is opening shipping routes through the Arctic that didn't exist before. Russia and China are expanding their presence there. Canada needs to be able to see what's happening in those waters and assert sovereignty. The German submarines are built for stealth in contested areas, which is exactly what the Arctic is becoming.
Seventy billion dollars is a staggering number. How does Canada justify that kind of spending?
The actual submarine contract is twelve billion. The seventy billion includes fifty years of maintenance, training, spare parts, and support. But yes, it's enormous. Canada is committing to a complete modernization of its military—submarines, fighter jets, expanded defence spending. They're signalling they're serious about NATO obligations and less willing to depend solely on the United States.
The South Koreans spent millions on advertising, including Peter Mansbridge. That seems like they really wanted this.
They did. And they made a credible offer—larger submarines, local manufacturing of military vehicles, real economic benefits. But they're not in NATO. In the end, that mattered. Germany is already integrated into the alliance's supply chains and strategic planning in ways South Korea simply isn't.
What happens next?
Negotiations. The government and ThyssenKrupp have to work out the details, which could take years. Meanwhile, Canada is still deciding on those Swedish fighter jets. The whole picture is a country trying to rebuild its military capacity while hedging its bets away from the United States.