Canada Weighs Phased Submarine Purchase From Germany

Ottawa is considering splitting its order for up to 12 German-built submarines into two phases.

Updated on Nov. 4, 2026 in Canada

Bold flat-color editorial illustration of a grey submarine hull on a dockyard cradle beside a gantry crane under overcast sky. — Canada is weighing a phased purchase of up to 12 German-built submarines, starting with eight, a change that could affect Germany's linked $86-billion investment package. AI Illustration. Upload story photo >

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Canada is considering splitting its purchase of up to 12 German-built submarines into two phases, starting with an initial order of eight vessels. The proposed change could affect economic benefits Germany has linked to the deal, including an $86-billion investment package.

Why it matters

The proposed change is intended to give future Canadian governments greater financial flexibility. Defence analysts have warned that reducing the initial order could weaken the economic advantages of the partnership.

The planned purchase covers up to 12 submarines, with an initial order of 8 vessels and 4 potentially ordered later. The estimated programme cost is $20 billion to $24 billion, excluding long-term operating and maintenance expenses, and the status of the final contract remains unresolved.

The players

ThyssenKrupp Marine Systems (TKMS)

A German shipbuilder that took part in recent Ottawa discussions on the proposed submarine purchase.

Kongsberg

A Norwegian defence technology company that took part in recent Ottawa discussions on the proposed submarine purchase.

The details

Officials, ThyssenKrupp Marine Systems (TKMS) and Kongsberg discussed the phased proposal in recent meetings in Ottawa. Germany has linked a promised $86-billion investment package to the deal, with potential projects involving critical minerals, port development, carbon capture technology and defence manufacturing.

Recent meetings in Ottawa on the phased proposal (exact dates not specified).

Political Context

Ottawa's consideration of a phased order reflects an effort to keep spending flexible for future governments, while defence analysts have cautioned that a smaller initial commitment could reduce the economic benefits tied to the partnership with Germany.

A phased order would shift when and how the submarine spending is committed, which affects how public defence funds are allocated over time. No final contract has been signed, so the timing and scale of the purchase remain uncertain.

The takeaway

Large defence purchases can be restructured in phases to preserve financial flexibility, but the economic terms tied to them can change as a result. Readers tracking the deal should watch for a signed contract to confirm the final scope.