Germany says a Canadian decision to choose German submarines over South Korean competitors would be an important first step toward deeper long-term strategic cooperation.
A senior German government official said Monday that such a move would also bring Ottawa closer to Europe at a time when Canada is working to strengthen trade and defence relationships beyond the United States.
Canada Expected to Name Preferred Submarine Bidder
Prime Minister Mark Carney is expected to announce Canada’s preferred bidder for a major submarine contract on Monday, according to a report from the Globe and Mail.
The announcement is expected shortly before Carney travels to a NATO leaders’ summit in Turkey.
Carney has been seeking closer economic and strategic ties with Europe amid ongoing tensions with the administration of U.S. President Donald Trump.
Germany Sees NATO Timing as Important
A senior German official said Berlin would welcome a positive sign from Canada ahead of the NATO summit, which begins Tuesday.
The official said such a decision would carry a real transatlantic dimension, suggesting that the submarine deal could become more than a defence procurement decision.
For Germany, the contract could signal stronger cooperation between Canada and European NATO partners.
German and South Korean Firms Competing
The contract is for 12 submarines.
The two main contenders are:
- TKMS, the German warship builder, working with partner Norway
- Hanwha Ocean, a South Korean shipbuilding company
A Canadian decision in favour of TKMS would mark a major win for Germany and Norway in a highly competitive defence contract.
TKMS Shares Rise During Trading
Shares in TKMS rose 2.7 per cent in early afternoon trading.
Brokerage Metzler has estimated that TKMS could more than triple its order backlog to €68 billion, or about US$78 billion.
That estimate included the potential Canadian order among other expected factors.
TKMS was spun off from Thyssenkrupp last year.
German Chancellor Backed the Deal
German Chancellor Friedrich Merz has reportedly devoted significant political effort to the submarine deal in recent weeks and months.
The German official said the coming days would show whether that effort succeeds.
A Canadian decision in favour of TKMS would be viewed as a political and industrial success for Berlin.
TKMS Offered Broader Investment Package
In January, TKMS CEO Oliver Burkhard told Reuters that the company was in talks with Norwegian and German firms about offering Canada a multi-billion-dollar investment package.
That package could include investments connected to rare earths and battery chemicals.
The proposal was part of TKMS’s wider effort to win the Canadian submarine tender.
Canada’s decision on its 12-submarine contract could carry major strategic, political and economic significance.
Germany believes a Canadian choice of TKMS over South Korea’s Hanwha Ocean would strengthen long-term defence cooperation and move Ottawa closer to Europe.
The timing is especially important as Prime Minister Mark Carney prepares to attend a NATO summit in Turkey while trying to deepen European ties amid tensions with the Trump administration.
With German Chancellor Friedrich Merz backing the effort and TKMS proposing broader industrial investments, the submarine deal could become a major step in Canada-Europe strategic relations.