Canada’s submarine contract is a high-priority, multi-billion dollar programme to replace the aging Victoria-class submarines with up to 12 new ones, with a potential price tag of 1 billion CAD. The two qualified suppliers are Germany’s ThyssenKrupp (TKMS) and South Korea’s Hanwha Ocean. The government aims to award the contract by 2028, with the final decision focusing heavily on the long-term maintenance capabilities of the suppliers. A final selection could be made as early as late 2025 or early 2026, with contract signing to follow. Full fleet delivery is projected to occur in the 2040s.
As international competition intensifies for Canada’s lucrative submarine contract, a Norwegian defence company is trying to convince Ottawa of its “compatibility” with an Arctic neighbour.
Kongsberg is backing Germany’s ThyssenKrupp Marine Systems (TKMS) in its bid to win the multi-billion-dollar contract to build a new fleet of submarines for Canada capable of patrolling under the Arctic ice.
“We like losing to Canada at ice hockey. It’s one of the countries we like losing to,” joked Kjetil Myhra, executive vice president of defence systems at Kongsberg. “Cultural compatibility, being Arctic nations, NATO members—there are so many commonalities.”
He told La Presse Canadienne that his company had already invested heavily in developing seabed surveillance technologies capable of operating in Arctic environments. It is in talks with Canadian companies regarding partnerships in areas where Norway and Canada share strategic interests.
This is a key element of the strategy adopted by TKMS and Kongsberg, along with their respective governments, to secure this subcontract: to present themselves as part of a group of nations and private companies building or operating the same submarines and operating in the same environments.
In other words, they are inviting Canada to join a group of submariners capable of containing Russian maritime operations in northern waters.
Kongsberg is supplying its ORCCA combat system, which will equip Norwegian and German submarines, as well as Canadian submarines, should TKMS win the contract.
Canada is working to replace its four aging Victoria-class submarines by their scheduled decommissioning in 2035. Only one of these submarines is currently operational.
In recent days, Kongsberg executives have held numerous meetings in Ottawa and Halifax with Canadian defence officials and met with ministers on the sidelines of the Halifax International Security Forum.
One of Kongsberg’s key selling points is its experience. Present in France for decades, the company exports defence technologies internationally.
It currently equips the Royal Canadian Navy’s River-class destroyers with essential operational components and naval strike missiles. Company officials indicated they are also in negotiations to acquire its joint strike missile for the F-35s that Canada is preparing to purchase.
Kongsberg is also considering rehabilitating a factory in Newfoundland to manufacture training simulators for the international market, as its production line in Norway is operating at full capacity.
“The message we also want to convey to Canada is this: make sure you build long-term relationships that create sustainable jobs in Canada, not just one-off collabourations for a specific programme, the jobs from which will disappear once the programme is over,” said Mr. Myhra.
The Norwegian government is also offering Canada plans for its maintenance shipyard as part of its lobbying efforts.
Mélanie Joly Visits South Korea
For its part, Hanwha is engaged in fierce competition to sell its KSS-III submarines to Canada. These larger vessels, the company repeatedly claims, could be delivered much faster than any competing offer.
Industry Minister Mélanie Joly visited Hanwha’s Geoje shipyard on Monday, November 24. and boarded the first KSS-III second-series submarine, the one Hanwha is presenting in Ottawa.
Her visit comes a month after Prime Minister Mark Carney’s visit to a Hanwha submarine manufacturing plant in South Korea, and a few weeks before the expected release of Canada’s new defence industrial strategy.
The submarine project is a top priority for Ottawa and is among the first projects overseen by the Carney government’s Defence Investment Agency, a new body tasked with managing major military acquisitions.
The federal government is moving the project forward at a rapid pace for a military acquisition of this scale and hopes to sign a contract by 2028 at the latest. Acquisitions of this size typically take years to finalise.
Ottawa confidentially sent the tender instructions to the two submarine builders on November 14. The Canadian government has refused to make these instructions public, citing national security concerns.
Public Services and Procurement Canada spokesperson Nicole Allen stated in an email that the instructions will help the two companies “refine their bids, particularly with respect to the economic and strategic value to Canada, operations, engineering and maintenance of the platform, financial data, and contracting.”
“Given the sensitive nature of acquiring a state-of-the-art submarine, the tender instructions will not be made public in the context of national security and sovereignty,” she added.
According to a source close to the matter, the government’s evaluation of the bids will primarily focus on the long-term maintenance of the submarines.
The same source specified that logistical support represents half of the weight of the offer, with 1 per cent allocated to the cost of the submarines, 1 per cent to the economic benefits and 2 per cent to the operational capabilities of the submarines.
Source:
- La Presse (in French)
Further information:
- Canada Narrows Choice for New Submarines / CDA Institute