The competition to build the Royal Canadian Navy’s next generation of submarines has entered a decisive phase after the two remaining bidders submitted their final proposals to the federal government on Monday.
Canada plans to purchase up to 12 conventionally powered submarines, with the goal of having the first vessels operational by 2032. The multibillion-dollar procurement has been fast-tracked as the navy’s aging Victoria-class submarines are expected to retire within the next decade.
The final contenders are South Korea’s Hanwha Ocean and ThyssenKrupp Marine Systems, known as TKMS, which is bidding in partnership with industry players from Germany and Norway.
Stephen Fuhr, Canada’s secretary of state for defence procurement, said earlier this year that Ottawa is expected to announce a winner before the end of 2026. The Liberal government has emphasized that the decision will be based not only on military capability but also on which proposal delivers the strongest economic and industrial benefits for Canada.
Government officials have already toured shipyards in South Korea and Germany, while delegations from both countries have visited Canada as part of the evaluation process. Hanwha and South Korean officials have promoted the submarine project as the foundation for a deeper long-term industrial partnership between the two countries. Meanwhile, TKMS has indicated it could build some of the submarines in Canada if awarded the contract.
Both companies have signed cooperation agreements with multiple Canadian firms and have stepped up their public presence in recent months. Hanwha has launched a visible advertising campaign in downtown Ottawa, including bus shelter and digital ads, while TKMS is the main sponsor of this week’s Conference of Defence Associations Institute annual meeting in the capital.
Tom Lawson, chair of the institute’s board and a former chief of the defence staff, said Canada has significantly shortened what is usually a lengthy defence procurement process. He noted that the accelerated timeline reflects the federal government’s new defence industrial strategy and sends a positive signal to the military and industry alike.
Lawson added that while both companies are eager to win the contract, neither depends entirely on the outcome for survival, as each has submarine orders from other countries in the pipeline. Still, with billions of dollars at stake, both firms are expected to compete aggressively until a final decision is made.
