Warship builder Thyssenkrupp Marine Systems (TKMS) is assembling a sweeping, multi-billion-dollar investment package spanning defence and advanced industries as it competes to win Canada’s flagship submarine procurement, its chief executive said.
The German company is in talks with Norwegian and German firms to bundle investments in areas including rare earths, mining, artificial intelligence and automotive battery production alongside its submarine offer, TKMS CEO Oliver Burkhard told Reuters.
The previously unreported plan is aimed at strengthening TKMS’s bid in a fiercely contested tender to supply up to 12 next-generation submarines to the Canadian navy. TKMS was short-listed last year alongside Hanwha Ocean of South Korea.
Industry sources estimate the submarine contract alone could be worth more than €10 billion ($12 billion). The total value of the broader investment package could rise substantially, depending on the scale of commitments made by partner companies, according to people briefed on the discussions.
“It is no longer just about the submarines. It is primarily about what’s beyond,” Burkhard said on the sidelines of an event in Frankfurt, describing the proposal as a “broad economic package” designed to persuade the Canadian government.
TKMS is the world’s largest builder of non-nuclear submarines, accounting for roughly 70% of NATO’s conventional submarine fleet.
Burkhard said the company was in discussions with German space start-up Isar Aerospace as part of the initiative, though he declined to name other firms involved. He added that TKMS was sounding out potential partners on future investment plans in Canada and whether these could be folded into long-term offset obligations—mandatory economic commitments typically spread over 30 years.
“Of course, that also includes the defence sector,” he said.
Canada, which has the world’s longest coastline, has said its submarine programme is intended not only to modernise naval capabilities but also to maximise domestic economic benefits under its broader defence strategy.
Burkhard said officials from Germany’s economy and defence ministries, as well as the Chancellery, were involved in discussions related to the bid. He said he expects Canada to make a final decision in 2026, and added that he plans to travel to Canada again in March for further talks.
“All defence procurements must advance Canada’s national and military interests as well as provide a clear, measurable net benefit to Canada’s economy,” Canada’s Ministry of Innovation, Science and Economic Development said in a statement.
Germany’s economy ministry referred questions to the defence ministry, which said it does not comment on confidential consultations. The Chancellery did not respond to a request for comment.
Hanwha Ocean declined to comment.
TKMS, which has assigned between 30 and 40 staff to work on the offset package, is offering its 212CD-class submarine as part of the tender. The same class is being supplied to Norway’s navy under a joint German-Norwegian modernisation programme.
(with inputs from Reuters)
