Canada proposes eight German submarines up front and four later — with $86 billion in German benefits in the balance

By The Canadian Chronicle · Thursday, November 5, 2026

Politics · Defence · The Canadian Chronicle

Published Thursday, November 5, 2026 · 2 min read

Canada has proposed splitting its planned purchase of German submarines in two: eight boats committed up front, and four more decided later. Sources told CBC News the proposal is meant to preserve financial flexibility — and that it could put some of Germany's promised economic benefits at risk.

The proposal

The proposal was made during meetings last week in Ottawa between federal officials led by the Defence Investment Agency and representatives of German submarine-maker TKMS and Norwegian defence company Kongsberg. The approach has been discussed since September, following meetings in Europe.

No contract has been signed. The government has set a deadline of the end of 2027 to finalize it.

The fleet it replaces

Prime Minister Mark Carney announced in July that Canada had selected TKMS as its preferred supplier for up to 12 Type 212CD submarines, ahead of South Korea's Hanwha Ocean. The boats would replace the Royal Canadian Navy's aging Victoria-class fleet.

The full programme's cycle cost has been estimated at over $100 billion over two decades. Germany and Norway are granting Canada production slots for four boats through 2036, with first deliveries envisaged from the middle of the 2030s.

What is in the balance

Germany has linked an $86 billion investment package to the deal, with potential projects in critical minerals, port development, carbon capture technology and defence manufacturing. Sources say a smaller firm commitment up front could jeopardize some of those benefits.

Officials maintain that eight submarines is still a very large number. Whether the final contract commits to eight or to the full 12 is now a budget-era question as much as a naval one — and it lands on the same day the government tables a budget built around major investment.