Canada
July 7, 2026
Canada taps TKMS for submarines, passes on Algoma-linked deal
Written by Ethan Bernard
The Canadian government has selected a German firm to build submarines, passing on a contract from a South Korean company linked with Algoma Steel.
“Thyssenkrupp Marine Systems (TKMS) has been selected as the preferred supplier to begin negotiations for delivering Canada’s next fleet of submarines to the RCN (Royal Canadian Navy),” Canadian Prime Minister said in a statement on Monday.
“This will be the largest defense procurement in Canadian history,” he added.
Carney said Canada and TKMS will now enter into negotiations to finalize the contracts. Contracting should be concluded no later than the end of 2027. And the first four submarines are to be delivered ahead of schedule, in 2034.
However, if the negotiations prove unsuccessful, Canada may designate South Korea’s Hanwha Ocean as the preferred supplier and enter into negotiations with it, the statement said.
Recall Sault Ste. Marie, Ontario-based steelmaker Algoma signed a binding memorandum of understanding with maritime firm Hanwha Ocean earlier this year. It included up to US$250 million in potential value tied to structural steel development and submarine-program supply.
According to media reports, it would’ve included a structural steel beam mill in Sault Ste. Marie and the purchase of Algoma products.
A spokesperson for Algoma told SMU on Tuesday the company congratulates Thyssenkrupp Marine Systems, “and commends the Government of Canada on this important step for Canada’s security and industrial capability.”
“As one of Canada’s largest steel producers, Algoma is proud to see Canada investing in its own industrial and defense capability, and looks forward to the opportunities that this investment creates for the Canadian steel industry,” the spokesperson added.
Algoma also thanked Hanwha “for working with us and we hope there are opportunities to collaborate in the future.”
