Canada has officially provided clear bidding instructions to the two competing companies aiming to construct the navy’s new submarines, as per information obtained by CBC News. The instructions were sent to ThyssenKrupp Marine Systems (TKMS) of Germany and Hanwha Ocean Co. Ltd. of South Korea last week. James Rourke, an official at the newly established federal Defence Investment Agency, confirmed the delivery of the document to both qualified bidders.
A portion of the extensive 40-page document has been reviewed by CBC News to verify its authenticity. The federal government will heavily consider the sustainment package each company can offer for the 12-submarine fleet post-purchase, with this aspect accounting for fifty percent of the company’s score. Other factors include the platform itself (20%), the company’s financial strength (15%), and economic benefits related to the contract (15%).
Rourke refrained from providing specific comments but emphasized the procurement’s objective to maximize economic benefits for Canada, generate high-quality jobs, and fuel economic growth leveraging the country’s defense industry. The bids from both companies are expected by March, according to two separate defense sources. Initially, five firms expressed interest in the submarine project, but Prime Minister Mark Carney’s government narrowed the selection down to ThyssenKrupp Marine Systems and Hanwha Ocean Co. Ltd.
Carney has personally visited the shipyards and examined the submarine offerings. The project, aimed at replacing Canada’s aging Victoria-class submarines, has an estimated value of up to $24 billion solely for the boat acquisition. The federal government intends to establish sustainment facilities on both coasts to create employment opportunities in Canada.
Alan Williams, a former top procurement official at the Defence Department, initially raised concerns about the quick downselection process to two bidders but expressed satisfaction upon the issuance of formal instructions. Transparency is crucial given the substantial purchase size, he emphasized. The government, especially Industry Minister Mélanie Joly, has underscored the Liberals’ desire to utilize defense spending for economic development.
Political maneuvering like that seen in the F-35 fighter jet review is cautioned against in the submarine procurement process. Joly has engaged with Saab regarding the Gripen E fighter jet, exploring options beyond the F-35 program. Williams stressed the importance of avoiding political interference in the submarine bidding process.
The bidding phase is now in progress, and Williams advised against ministerial interventions that could lead to legal complications.