Canada picks Germany's TKMS for submarine contract, shutting out Team Korea

Germany's ThyssenKrupp Marine Systems has been named the preferred bidder for Canada's next-generation submarine program, known as the Canadian Patrol Submarine Project, worth up to 60 trillion won ($39 billion). Hanwha Ocean and its Team Korea partners, who competed against TKMS, expressed disappointment at the outcome.

Canadian Prime Minister Mark Carney announced Monday that TKMS had been selected as the preferred negotiating partner for the program. He said TKMS had proposed reallocating a portion of submarines already on order for the German and Norwegian navies to Canada, allowing the country to receive its first four vessels by 2034 — ahead of the original schedule.

However, Carney added that Canada retains the right to open negotiations with the second-ranked bidder, Hanwha Ocean, should talks with TKMS break down. The Canadian government plans to negotiate with TKMS through the end of next year.

The program covers the construction of 12 submarines and 30 years of maintenance, repair and operation, bringing the total contract value to 60 trillion won. Hanwha Ocean had proposed its 3,600-ton Jangbogo-III Batch II submarine — a platform already built and in active service. Its predecessor, the ROKS Dosan Ahn Chang-ho (Jangbogo-III Batch I), had already demonstrated interoperability with the Canadian navy after sailing 14,000 kilometers from Jinhae through Guam and Hawaii to a naval base on Canada's west coast. By contrast, the TKMS-proposed Type 212CD submarine was still at the design stage, with no vessel yet built.

Hanwha Ocean is also understood to have proposed delivering the first vessel in 2032, four submarines by 2035 and all 12 by 2043, while pledging to generate roughly 70 billion Canadian dollars in economic opportunities for Canada by 2044. Despite those offers, the company ultimately could not overcome the wall built by the German-Norwegian alliance, which emphasized its longstanding NATO ties.

Throughout the competition, Germany stressed TKMS's submarine-building track record and its deep cooperative relationship with Canada through NATO. TKMS draws on European defense cooperation experience and NATO operational history through the Type 212CD family of submarines used by the German and Norwegian navies. The fact that a large number of NATO member states already operate German-built submarines gave Germany an inherent advantage in joint operations, maintenance and training.

In a statement Tuesday, Hanwha Ocean said it had "done its utmost to win the Canadian next-generation submarine contract but was unable to achieve the hoped-for result." The company added that it had "poured everything into the bid, backed by full government support, the outstanding performance of our submarines and the navy's proven operational experience — but could not break through the wall of the NATO alliance." It said it believed "the result is entirely due to Hanwha Ocean's own shortcomings," adding that it was left with deep regret despite having given its all.

Hanwha Ocean said it would "carefully analyze the challenges identified through this competition, develop concrete solutions and find a path for K-maritime defense to make an even greater leap in the global market." The company also expressed gratitude to the public, the government, the National Assembly, the navy, the Defense Acquisition Program Administration and all military officials who provided support, as well as to all the companies that took part in the bid.

HD Hyundai Heavy, which contributed to the effort as part of the unified team, also issued a statement thanking the government, relevant agencies, companies and the public for their support "until the very end." The company said that while it was disappointed the effort did not yield results, "the experience of the Republic of Korea running as one team will serve as a solid stepping stone for K-defense to make a great leap forward." It added that it would "do its best to build on this experience and deliver results in K-defense exports and the advancement of national interests."