Ottawa’s decision to pick German firm Thyssenkrupp Marine Systems (TKMS) to supply 12 new submarines to replace Canada’s aging fleet is expected to impact the Atlantic region economically for decades to come.
Nova Scotia experts and politicians are weighing in on what this means for the province.
“The first thing people are going to be observing will be groundbreaking stuff, new construction,” said Ken Hansen, a Halifax-based independent defence analyst and owner of Hansen Maritime Horizons.
Prime Minister Mark Carney announced the decision in Halifax on Monday. The first sub is expected by 2033.
The federal government will not reveal the final contract price until negotiations are complete, Carney said. However, he said a condition of the deal is that “the value of our investment must be matched with investment here in Canada.”
“So all 12 submarines won’t be based here. They’ll probably be split maybe 50-50 with the West Coast, but it’s going to mean construction, it’s going to mean new facilities for submarines alone,” Hansen said.
Hansen, who is a former naval commander, says it will also mean the creation of supply centres and maintenance facilities.
“It’s pretty extensive, even the supply chain and the people that have to manage the spare parts of being involved in the manufacturing of parts,” he said.
“I’ve used 15,000 full-time permanent jobs as an estimate. That’s just an estimate. There are others out there who are aiming much, much higher, for the full life of the program, like 600,000 man-day job hours.”
Carney says the new subs will offer stealth, Arctic capability and easier co-operation with NATO allies, Germany and Norway.
South Korea’s Hanwha Ocean was also in the running to build the subs before the winner was announced.
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German Chancellor Friedrich Merz and Finance Minister Lars Klingbeil said on Tuesday that the deal was good news for Germany’s economy and collective security within NATO.
Gastops, a Canadian tech company with an office in Nova Scotia, has partnered with TKMS to support the sustainment of the control systems.
“I’d say the benefits of a program like this go far beyond the construction of the equipment,” said Shaun Horning, Gastops’ president and CEO.
“And that there are opportunities for decades ahead for businesses across the country from coast to coast and businesses of all sizes, small businesses like Gastops to medium and large-sized businesses.”
Nova Scotia Premier Tim Houston welcomed the news and said it’s beneficial for the province.
“This is really a generational investment, I think. The prime minister said about the investments that could flow to Nova Scotia and to Halifax are extraordinary,” Houston said Monday.
“I believe that for sure and I’m really excited.”
Halifax Mayor Andy Fillmore said the announcement “advances one of the most consequential defence procurement decisions Canada has made in a generation.”
“While details are still forthcoming, it’s clear that Halifax will play a significant role in the long-term maintenance, training, and in-service support activities of this fleet — the benefits of which will extend well beyond the dockyard,” he wrote in a statement.
“For generations, Halifax has helped safeguard Canada’s Atlantic and Arctic interests. Our responsibility now is to ensure our municipality is equally prepared to support the people, infrastructure, partnerships, and communities that will sustain it for decades to come.”
The next phase of the plan includes closed-door negotiations to work out the details. If those negotiations are unsuccessful with TKMS, Canada has the right to turn to Hanwha Ocean and negotiate with them instead.
Either way, Ottawa plans to have a contract inked by the end of 2027.
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