Canada Advances Submarine Bid to German and South Korean Suppliers: Narrowing Choices in Navy Procurement Decision-making Process

August 26, 2025
By Archyde News Team

Ottawa – Canada has substantially advanced its long-awaited program to replace its aging fleet of submarines, reducing the field of contenders to just two international firms: Germany’s ThyssenKrupp Marine Systems (TKMS) and South Korea’s Hanwha Ocean Ltd. This decision, announced Tuesday, marks a crucial turning point in a procurement process that has been years in the making and carries substantial strategic importance for the nation’s naval capabilities.

A Delicate diplomatic Dance

Prime Minister Mark Carney recently concluded a visit to Germany, where defense and security concerns were central to discussions with Chancellor Friedrich Merz. Carney emphasized a commitment to a fair and obvious competition, though details regarding the selection process remain closely guarded. He also plans a visit to Hanwha Ocean Ltd. facilities in South Korea this fall, underscoring the government’s intent to thoroughly evaluate both proposals.

During his trip, the Prime Minister engaged in a business roundtable aiming to bolster trade ties and establish a collaborative partnership concerning critical minerals. This diplomatic effort coincided with the submarine selection process,hinting at a broader strategy to strengthen international alliances.

Competing Visions for Canada’s Future Fleet

The competition centers around two distinct submarine designs. TKMS is proposing the Type 212CD, a vessel developed jointly with Norway, while Hanwha Ocean Ltd. submitted a detailed, unsolicited bid earlier this year. Federal officials are now debating whether to proceed with a full request for proposals or to directly negotiate with a preferred bidder. The stakes are high, with the contract potentially worth billions of dollars and shaping Canada’s underwater defense capabilities for decades to come.

The Type 212CD, already in production for Germany and Norway, boasts advanced features including air-self-reliant propulsion, allowing for extended submerged operations – a crucial capability for Arctic environments. Norway’s program director of submarines, Captain (N) Oystein Storebo, highlighted the vessel’s ability to operate effectively in all oceans, including the challenging Arctic region.

Feature	Type 212CD (TKMS/Norway)	Hanwha Ocean Ltd. (Details Limited)
Origin	Germany/norway	South Korea
Propulsion	Air-Independent Propulsion (AIP)	conventional Diesel-Electric (details Emerging)
Arctic Capability	Designed for Arctic Operations	Capability Assessment Ongoing
Production Status	In Production	Bidder Stage

Did You Know? Canada’s current Victoria-class submarines are reaching the end of their service life, requiring a replacement to maintain the country’s underwater defense presence.

economic and Strategic Considerations

TKMS has proposed establishing a submarine maintenance facility within Canada, a key condition repeatedly emphasized by the Liberal government to ensure job creation and domestic economic benefits. Oliver Burkhard, CEO of TKMS, suggested that integrating Canada into the existing production line could potentially expedite delivery, possibly as early as 2032-2033. This might involve reallocating a submarine originally intended for Germany or Norway.

Pro Tip: Understanding the geopolitical context is key. The submarine procurement isn’t just about military hardware; it’s about strengthening alliances and bolstering national security in a rapidly changing world.

The urgency of this procurement is underscored by canada’s desire to have a decision finalized by 2027, ensuring a timely transition to a modern submarine fleet.The final choice will have far-reaching implications for Canada’s naval strategy and its role on the global stage.

Submarine Warfare: A Modern Overview

Submarine technology continues to evolve rapidly. Modern submarines are increasingly reliant on stealth, advanced sensors, and sophisticated weaponry. Operations often involve intelligence gathering, anti-submarine warfare, and power projection. As global tensions rise, the demand for advanced submarine capabilities is onyl expected to increase, making Canada’s procurement decision all the more critical. According to a recent report by Janes, global defense spending on submarines is projected to reach $80 billion by 2028.

Frequently asked Questions

• What is the primary goal of Canada’s submarine procurement? The main aim is to replace Canada’s aging Victoria-class submarines and maintain a credible underwater defense capability.
• What is the Type 212CD submarine? It’s a modern, German-designed submarine developed in collaboration with Norway, known for its advanced technology and Arctic capabilities.
• What role does Prime Minister Carney play in the selection process? The Prime Minister is actively involved in diplomatic discussions and has emphasized the importance of a fair and transparent competition.
• what are the potential economic benefits of this procurement? The winning bidder is expected to create jobs in Canada, potentially through the establishment of maintenance facilities and technology transfer.
• How long will it take for Canada to receive its new submarines? The timeline is still uncertain, but early delivery could be as soon as 2032-2033 if Canada joins the existing production line.
• Why are submarines significant for Canada’s defense? Submarines provide a vital strategic advantage, allowing for covert surveillance, protection of vital sea lanes, and deterrence of potential adversaries.
• What is air-independent propulsion and why is it important? Air-independent propulsion (AIP) allows a submarine to stay submerged for extended periods without needing to surface for air, significantly increasing its operational range and stealth.

What are your thoughts on Canada’s submarine procurement process? Share your opinions in the comments below, and don’t forget to share this article with your network!

What specific industrial benefits are HDSM and TKMS proposing for Canada?

Canada Advances Submarine Bid to German and South Korean Suppliers: Navy Procurement Update

The Shortlist: HD Korea Shipbuilding & Marine Engineering (HDSM) and ThyssenKrupp Marine Systems

Canada has significantly progressed its long-awaited submarine procurement project, officially narrowing the field to two contenders: South Korea’s Hanwha Ocean (formerly Daewoo Shipbuilding & Marine Engineering, now part of HD Korea Shipbuilding & Marine Engineering – HDSM) and Germany’s ThyssenKrupp Marine Systems (TKMS). This decision marks a critical step in replacing Canada’s aging Victoria-class submarines, a process plagued by delays and shifting requirements.The selection process, overseen by the Department of National Defense (DND), focuses on delivering a modern fleet capable of addressing Canada’s evolving security needs in both the Atlantic and Pacific Oceans.

Key Considerations Driving the Decision

Several factors influenced the decision to advance these two bids. These include:

Proven Technology: Both HDSM and TKMS offer submarines with established track records and demonstrated capabilities.HDSM’s DSME 3000 class and TKMS’s Type 214 submarines are both considered leading designs in modern naval warfare.

Industrial Benefits: A significant component of the evaluation criteria centers on maximizing economic benefits for Canada. This encompasses job creation, technology transfer, and the growth of a domestic naval industrial base. Both bidders have proposed considerable industrial benefit packages.

Lifecycle Costs: The total cost of ownership, including acquisition, maintenance, and eventual disposal, is a crucial consideration.The DND is meticulously analyzing the long-term financial implications of each proposal.

operational Requirements: Canada’s specific operational needs,including Arctic operations,anti-submarine warfare,and intelligence gathering,are paramount.The submarines must be capable of performing a wide range of missions in challenging environments.

Strategic Partnerships: The ability to forge strong, long-term partnerships with Canada is also being assessed. This includes collaboration on research and development, training, and ongoing support.

Comparing the Bids: HDSM vs. TKMS

while both companies present viable solutions, key differences exist between their proposals.

Hanwha Ocean (HDSM) – DSME 3000 Class:

Design: The DSME 3000 is a next-generation diesel-electric submarine known for its advanced sonar systems and quiet operation.

Industrial Benefits: HDSM has pledged significant investments in Canadian shipbuilding and defense industries, perhaps establishing a major manufacturing hub.

Technology Transfer: The proposal includes extensive technology transfer to Canadian companies, fostering domestic expertise in submarine design and maintenance.

Potential Challenges: Concerns have been raised regarding the complexity of integrating the DSME 3000 into the Royal Canadian Navy’s existing infrastructure.

ThyssenKrupp Marine Systems (TKMS) – Type 214 Class:

Design: The Type 214 is a highly modular and adaptable submarine, renowned for its air-independent propulsion (AIP) system, allowing for extended submerged operations.

Industrial Benefits: TKMS has proposed a collaborative approach, leveraging existing Canadian shipbuilding capabilities and establishing partnerships with local firms.

Proven Performance: The Type 214 is currently in service with several navies worldwide, including Germany, Greece, and Turkey, demonstrating its reliability and effectiveness.

Potential Challenges: The type 214’s modular design may require significant customization to meet canada’s specific requirements.

The Role of Air-Independent Propulsion (AIP)

AIP technology is a critical aspect of the submarine procurement process.AIP systems allow submarines to operate underwater for extended periods without relying on oxygen from the surface, significantly enhancing their stealth and operational capabilities. Both HDSM and TKMS offer submarines equipped with AIP systems, though the specific technologies differ. The DND is carefully evaluating the performance, reliability, and lifecycle costs of each AIP system.

Timeline and Next Steps in the Procurement Process

The current phase of the procurement process involves detailed technical evaluations and contract negotiations with both HDSM and TKMS.

2025 (Late): Continued evaluation of proposals and refinement of requirements.

2026 (early): Down-selection to a single preferred bidder.

2026-2030: Contract negotiations and finalization.

* 2030s: Commencement of submarine construction and delivery.

This timeline is subject to change, but it represents the DND’s current projections.The project’s complexity and the need for thorough due diligence necessitate a cautious and purposeful approach.

Past Procurement Attempts & Lessons Learned

Canada’s attempts to replace its Victoria-class submarines have been fraught with challenges. Previous initiatives, such as the ill-fated Canada-U.S. submarine project in the 1990s,were ultimately abandoned due to cost overruns and political disagreements. these past failures have underscored the importance of a transparent, well-defined procurement process and realistic cost estimates. The current process aims to avoid the pitfalls of previous attempts by focusing on a rigorous evaluation of bids and a commitment to maximizing value for money. The Victoria-class submarines, originally acquired second-hand from the UK, are nearing the end of their service life, making a timely replacement crucial for