Canada chooses TKMS for 12 new submarines; billion-euro deal expected to bring investment and jobs

Canada is expected to order 12 submarines from the German defense company TKMS, according to reports published shortly before the start of the NATO summit in Ankara, Turkey.

The contract, worth billions of euros, provides for Canada’s purchase of twelve ultra-modern submarines built by the German military shipbuilder TKMS. Canadian newspaper The Globe and Mail reported that the German company emerged as the winner over South Korean shipyard Hanwha Ocean, after several months of rivalry over the project.

Ottawa aims to acquire Type 212 CD submarines, the same model already ordered by the German and Norwegian navies. The value of the project is estimated to exceed 10 billion euros.

On Monday morning (06.07.2026), the German government had expressed the expectation that Canadian authorities would select TKMS, the Kiel-based defense unit of Thyssenkrupp.

“This is a major strategic project. If it goes ahead, it will tie Canada to us for decades,” a government representative in Berlin said, pointing to the transatlantic importance of the military deal.

According to the same source, Federal Chancellor Friedrich Merz (CDU) had devoted considerable political effort in recent weeks and months to advancing the project.

Type 212 CD submarines are considered extremely difficult to detect and, thanks to modern lithium-ion batteries, are capable of operating autonomously for weeks at a time in complete silence.

During a visit to Canada, German Defense Minister Boris Pistorius (SPD), who promoted the submarines made in Germany, said that no other conventional submarine compares with them.

“Together we can build the largest and most modern fleet of conventional submarines in the world.”

TKMS chief executive Oliver Burkhard had indicated that he intended to win the Canadian contract through a broad industrial package. According to media reports, the discussions were not limited to submarines, but also included possible investment commitments in rare minerals, the mining industry, artificial intelligence, and battery production for the automotive industry.

As Burkhard put it, this is: “The largest contract ever awarded in the world of conventional submarines to a NATO partner.”

This major deal represents not only a success for TKMS, but also an advantage for Germany in terms of foreign policy.

According to the German government, the strategic rapprochement with Canada also serves to strengthen NATO, which is holding its annual summit in Ankara, Turkey.

The alliance is in a period of strategic repositioning: the United States is reducing its military contributions, while Europe is taking on more responsibility and increasing defense spending.

The planned submarine deal strengthens cooperation among Canada, Germany, and Norway, the third partner in the program, both in the defense industry and in the defense of NATO’s northern flank.

One of the declared goals of NATO allies is to buy standardized systems to make military cooperation easier, for example through the rapid exchange of data, crew training, and technical maintenance.

So far, Germany and Norway have each decided to buy six submarines of this model. With Canada’s order, the total production volume will double.

TKMS shares temporarily rose by as much as 11 percent.

The shipyard in Wismar, in the state of Mecklenburg-Vorpommern, is also expected to benefit from the military contract.

Cruise ships were previously built at this shipyard until the operator went bankrupt in 2022. In mid-2022, TKMS took over the facility and redirected it toward the construction of military and special-purpose vessels.

A production line for submarine hull sections has been set up there, and new jobs are being created.

Thanks to the major order from Canada, all of TKMS’s production capacities are expected to be fully occupied for many years to come. /dw