On July 6, Prime Minister Mark Carney announced that Canada had chosen ThyssenKrupp Marine Systems (TKMS) to deliver up to 12 Type 212CD submarines, the same submarine Germany and Norway are already building together under an existing joint program. TKMS beat out a competing bid from South Korean Hanwha Ocean and its KSS-III, and was “selected as the preferred supplier to begin negotiations.” Choosing the same platform as Germany and Norway at present just means Canada would be a customer of TKMS, but does not automatically make Canada a partner in North Atlantic defence. That will be determined by the negotiations.
As we argued in May 2026, the submarine decision was always about more than procurement. It was about whether Canada would be inside the architecture of democratic defence being built for the North Atlantic, and thereby integrated into the broader European defence industrial base. Canada made the right choice, but the harder question still lies ahead. What does Canada need to bring to this partnership to ensure this procurement structurally integrates the three nations?
The foundation was laid in July 2024, when Canada, Germany and Norway signed a trilateral letter of intent to establish a strategic partnership strengthening maritime security cooperation in the North Atlantic, in support of the North Atlantic Treaty Organization’s (NATO’s) deterrence and defence, with an emphasis on the defence industry, supply chains, training and operations. Canada’s political system then went through a period of upheaval, including a change in prime minister in March 2025, and lost precious time as a result. At CANSEC in May 2025, TKMS CEO Oliver Burkhard told CBC News that opportunities to enter the production line depended on “how swiftly” Canada moved. It did not move swiftly enough. In February 2026, more than a year and a half after the trilateral letter of intent, Germany and Norway signed the Hansa Arrangement, the most operationally integrated bilateral defence partnership in Northern Europe.
The Hansa Arrangement took that defence agenda considerably further, integrating missile systems, armoured vehicles, space surveillance, rapid reinforcement, maritime domain awareness and defence industrial cooperation. Germany and Norway went beyond deepening their submarine partnership. They built an integrated defence ecosystem. By choosing the 212CD, Canada is back at the table, but only on submarines. The negotiation with TKMS must widen that aperture toward the broader partnership originally envisioned in 2024, particularly in domains where Canada has not already chosen domestic strategic partners, or where Canadian companies can fulfill the “build” in build-partner-buy.
The secretary of state for defence procurement, Stephen Fuhr, declared that the July 6 announcement “demonstrates that Canada can move at the speed of relevance.” Compared to the initial timeline, which spanned almost a decade, that is a fair assessment. The harder test, however, is whether that speed carries through to the specifics of the submarine deal and, critically, to opening opportunities for broader defence industrial integration.
Despite the delays, the opportunity is not lost. After all, Germany and Norway each reallocated a submarine from their own production sequence to accelerate Canadian delivery, Kongsberg — partner and supplier for the 212CD submarines. — describing Canada as “an equal partner in an established submarine cooperation.” At the NATO summit in Ankara, the day after he announced the submarine decision, Carney met with German Chancellor Friedrich Merz and Norwegian Prime Minister Jonas Gahr Støre to celebrate the decision. And in late July, representatives from all three nations met in Kiel to launch a trilateral cooperation program for the 212CD, the first operational step toward making this partnership real.
That said, structural partnership is not yet guaranteed. Canada must negotiate its way from customer back to true partner, and that requires bringing something Germany and Norway cannot readily source elsewhere. Canada need not seek to integrate across every pillar of the Hansa Arrangement; in some domains, it has other preferred partners. But space surveillance, rapid reinforcement and maritime domain awareness, including undersea infrastructure protection and North Atlantic surveillance networks, lend themselves directly to North Atlantic defence architecture, and Canada has both a clear strategic interest in being foundational and domestic industrial capacity to contribute. If Ottawa approaches the negotiation as a procurement exercise focused on maximizing domestic industrial benefits alone, it will secure jobs and workshare but miss the greater strategic opportunity that made the 212CD the right choice in the first place.
Canada is putting greater emphasis on building the defence industrial base than at any point since C. D. Howe served as minister of defence production during the Korean War and the early Cold War. The Defence Industrial Strategy, released in early 2026, calls for reducing dependence on foreign suppliers while growing Canada’s defence industrial base, and if Bill C-31, the second Budget 2025 Implementation Act, passes into law, the Defence Investment Agency will have dedicated leadership to execute that vision. The TKMS proposal reportedly includes an ecosystem of well over 100,000 jobs, involving investments in torpedo manufacturing, construction of maintenance facilities, expansion of the Port of Churchill in northern Manitoba for liquefied natural gas export, and establishing a carbon capture facility in Alberta. These are significant commitments, though many details remain unclear.
Canada’s Industrial Moment
The defence industrial question has two dimensions. The first is the direct benefits to Canada of choosing TKMS: jobs, workshare and the specific commitments in the proposal. The second, and more consequential, is whether Canada’s defence industrial base can be integrated into the 212CD program supply chain and into the North Atlantic defence architecture. Will Canadian companies participate only in the construction of Canadian boats, or will they have access to the German and Norwegian production lines? The former arrangement would make Canada a buyer with a local assembly requirement. The latter would genuinely integrate Canadian industry into a trilateral defence ecosystem. Three contributions in particular stand out.
The first is space-based communications, sensing and digital systems integration. Canada has no industrial capability to build submarines, though it has gained warship building capacity through the National Shipbuilding Strategy project. What Canada does have is a space sector delivering world-leading capabilities in surveillance, communications and data processing, all essential to connectivity with deployed vessels. Canada is investing tens of billions in continental defence modernization, which will rely on ground and space-based capabilities to support Canadian sovereignty, NORAD operations, and NATO’s northern and western flanks, and largely on Canadian-sourced solutions.
Canada could expand the capacity of what it plans to deliver for these programs to include German and Norwegian users, or contribute technology directly to enable all three navies to support the same boat interoperably. Interoperability is one of the stated benefits of three nations operating a common platform. The same applies to data integration. Canada may not build submarines, but it has many companies delivering the enablers that connect a platform into a broader command and control (C2) architecture, and the systems integration expertise being developed for its army and air force programs can be configured to support maritime C2.
The second is Arctic research and testing. Canada has a long history of Arctic operational research. Exercises such as NANOOK build proficiency in Arctic operations alongside invited NATO Allies, with Joint Arctic Experiment components focused specifically on testing new systems in austere conditions. That capacity could be expanded to focus on submarines and maritime operations, offering Germany and Norway a cold-water trials and certification environment neither can run at home, and giving Canada a voice in design and configuration in return.
The third is strategic depth. Western intelligence sources have linked a wave of sabotage at European arms factories to Russia, conducted through local criminal networks and calibrated to fall short of triggering the North Atlantic Treaty’s Article 5. In August alone, there were explosions at EMCO in Bulgaria and at the KNDS Ammo Italy plant near Rome, as well as an arson attack on Estonian drone manufacturer Milrem Robotics, though Italian and Bulgarian officials have not confirmed Russian involvement. Canadian facilities are not immune, but targeting them is considerably more complicated and carries greater risk of compromise. During the Second World War, Canadian factories made enormous industrial contributions from beyond the range of German bombers. A version of that logic applies here, albeit on a far smaller scale.
European nations have collaborated on jointly developed platforms such as the Panavia Tornado and the Eurofighter Typhoon, building supply chains across every participating nation. The 212CD program is smaller and transatlantic, but Canada should use that simplicity to push for genuine integration in the domains where it has both strategic interest and industrial capacity, rather than settling for a standard offset arrangement.
In the end, Canada chose the option that opens the door to integration, and stated clearly that this was the reason. That vindicates the strategic logic of the trilateral partnership, but opening the door is not the same as walking through it. The Defence Industrial Strategy calls for Canada to build, partner and buy. On submarines, Canada is buying. The question now is whether it can negotiate its way to partnering. Based on the trilateral letter of intent, Canada was invited to do exactly that. The negotiation is where that invitation is either honoured or quietly set aside.
