Shares of South Korea’s Hanwha Ocean dropped 23% on Tuesday after the company failed to win a contract to build Canada’s next fleet of submarines.
Canadian Prime Minister Mark Carney announced on Monday that Germany’s Thyssenkrupp Marine Systems, known as TKMS, will be the chosen supplier for the submarines.
Hanwha Ocean’s contract was estimated to be up to $100 billion over three decades.
South Korean President Lee Jae Myung stated on his Facebook page that, despite the Canadian submarine project not yielding the expected results, “challenges inevitably bring both successes and disappointments. What matters is that we do not stop but continue to move forward.”
TKMS’s 212CD submarine platform is a collaborative project between Germany and Norway, two of Canada’s key allies. “The announcement marks the start of a new chapter in defence cooperation between three close NATO allies, bringing together shared expertise and common security interests,” TKMS stated.
The TKMS contract will give Canada access to European defense and industrial networks while U.S. President Donald Trump has been increasing pressure on NATO defense spending.
Following the decision, Vina Nadjibulla, vice-president of research & strategy at Asia Pacific Foundation of Canada, stated, “Canada’s choice of TKMS should therefore not be read as a rejection of South Korea or the Indo-Pacific. It is better understood as a decision that reflects the enduring pull of NATO, Arctic capability, transatlantic defence-industrial integration and procurement risk.”
Since the start of 2026, Hanwha Ocean has greatly expanded its presence in Canada, including signing an agreement with Ontario Shipyards to “accelerate the return of large-scale shipbuilding in Ontario and to strengthen Canada’s ability to deliver future naval programs.”
By CEO NA Editorial Staff
