The competition to supply Canada’s next generation of submarines has reached its final phase, with the federal government evaluating two competing bids for a major defence contract.

South Korea’s Hanwha Ocean and Germany’s ThyssenKrupp Marine Systems (TKMS) are the remaining contenders in a procurement expected to involve around 12 submarines and be worth tens of billions of dollars.

The project is intended to replace Canada’s ageing Victoria-class submarines, which are increasingly unreliable and expected to be retired by 2035, with only one currently operational.The government has accelerated the procurement timeline, with officials indicating a selection decision is expected by the end of June.

This unusually fast process for such a large military acquisition reflects Ottawa’s desire to modernise naval capabilities while also securing significant industrial and economic benefits for Canada.Both bidders have emphasised different strengths in their proposals.TKMS highlights its established NATO track record, interoperability with allied fleets, and proven submarine production experience.It has also proposed integrating Canadian companies into its supply chain and offering training and simulation opportunities.

Hanwha Ocean, meanwhile, is positioning itself as a high-speed delivery option with ambitious production timelines and extensive economic partnerships in Canada.

The company has highlighted potential job creation, GDP contributions, and industrial agreements with Canadian firms, including steel and automotive suppliers.It has also undertaken high-profile marketing efforts and naval demonstrations to raise its profile in Canada.

The decision will have long-term implications for Canada’s naval strategy, defence industry partnerships, and economic development, as the winning bidder is expected to deliver submarines over several decades while shaping domestic industrial participation in the program.