Canadian Prime Minister Mark Carney announced Monday that Germany's ThyssenKrupp Marine Systems (TKMS) has been selected as the preferred supplier for Canada's new submarine fleet, in a deal worth up to €20 billion.
The project will see the construction of up to 12 Type 212CD diesel-electric submarines for the Royal Canadian Navy, aimed at strengthening maritime defense in the North Atlantic and Arctic.
Carney made the announcement at a naval base in Halifax, Nova Scotia, calling it the largest procurement in Canadian history.
“It was a difficult, close decision between two highly qualified suppliers,” Carney said.
“In the end, this decision was about choosing the absolute best platform and partnership to meet Canada’s combined strategic, security, and economic interests.”
The decision marks a major setback for South Korea's Hanwha Ocean, which had actively campaigned for the contract.
Shares of Hanwha Ocean plunged about 23 percent on Tuesday, with the deal estimated by The Korea Times to be worth up to $100 billion over three decades.
Strategic and Economic Impact
German Defense Minister Boris Pistorius welcomed the partnership, stating, “Together, we will build the world's largest and most modern conventional submarine fleet.”
Pistorius noted that the submarines will enhance information sharing among Canada, Germany, and Norway, which already operates Type 212CD submarines.
He emphasized the critical importance of security lines across the North Atlantic for collective defense.
The German government expects the manufacturing contract to create up to 1,500 jobs at TKMS shipyards in Kiel and Wismar.
Canadian Defense Minister David McGuinty said the new vessels will secure Canada's extensive coastline, with the first submarines expected to enter service by 2035.
South Korean President Lee Jae Myung responded to the loss on Facebook, writing, “Challenges inevitably bring both successes and disappointments.
What matters is that we do not stop but continue to move forward.”
Vina Nadjibulla, vice-president of research and strategy at the Asia Pacific Foundation of Canada, said the choice reflects NATO alliance dynamics and Arctic capability needs, not a rejection of South Korea.
