Replacing the Subs

[oldcpu]

I note TKMS stock is now up 8% on the day (the news says up 12.5%).

Investing website: Why is TKMS stock surging today

 

[Furniture]

Please look at my earlier post on production from a few moments ago

The only think Canadian production would do is further delay getting the subs.

If we had a useful sub fleet now, developing a shipyard that could trickle new boats into the fleet would make some sense.

 

[Rainbow1910]

The choice of submarine doesn’t bother me as much as the choice of national partner. Canada is already a fairly close ally of both Germany and Norway through NATO and increasingly as of late, other economic and military partnerships. I personally view deepening of this relationship as a bit of a waste of effort and fundamentally just a continuation of the boring, unambiguous status quo.

Going with the Koreans would have been a bold step into effectively a new partner, given the breadth of their bid and how directly involved their government is. Canada has been talking about pivoting to the Indopacific for years and this would have been concrete proof of such a move. The loss of VLS is also a major kick to firepower aboard the boats, going entirely torpedo launched is rough and very limiting. This is also basically killing any Korean chance of growing their naval exports into the western world, and I would expect they will largely disengage from Canadian procurement in the future. They put everything they had into this make or break contest and seemingly failed, there isn’t anything else they could win in Canadian procurement will come anywhere near the value of this contract.

It seems like Carney is definitely a Europhile after all, we’re more interested in reinforcing an existing relationship compared to diversifying our defence and building new relations.

 

[PrairieFella]

Ya, both Irving and Davie have not covered themselves in glory when it comes to building military stuff on time and within cost. I would hope the Federal Gov will hold their feet to the fire.

As a resident on NB, I really don't like how both federal and provincial at times seem unwilling to confront the Irvings at times. A local joke is they basically own the province.

Its not just a local joke. Plenty of people know NB as Irvingstan out West.

 

[HavokFour]

It would be very funny if the actual announcement this afternoon contradicts this leaked announcement.

 

[Czech_pivo]

The only think Canadian production would do is further delay getting the subs.

If we had a useful sub fleet now, developing a shipyard that could trickle new boats into the fleet would make some sense.

I'm curious about that 1 line in that article.

With Babcock have a facility on the WC and Fuhr's announcement later today, I'm wondering if there is a chance that a production facility would be stood up on the WC to cover off the statement in the article.

 

[PrairieFella]

It would be very funny if the actual announcement this afternoon contradicts this leaked announcement.

Imagine its a poison pill to expose a leaker?

 

[Czech_pivo]

Imagine its a poison pill to expose a leaker?

Someone getting a 12 month posting to Alert.....

 

[Maxman1]

The better boat wins.

Excellent news for the RCN crews

Either one is a huge improvement over our current fleet.

 

[Underway]

Submarines either by Irving or Davie ?
What could possibly go wrong?
..

You're making assumptions. What about TKMS building out a yard here. Like they've done in half a dozen other countries. They are quite good at it.

Other thoughts if this is the case then its a slam dunk for TKMS. It further supports my point from earlier about Canada wanting direct defence jobs instead of milk plant or natural gas investment.

@Underway

Do you have any memory of the above being talked about in the past?

Nope.

But... There was a German language article where TKMS spoke about Canada as being a partner not a customer. It was a very clear change in tone within the interview as they were talking about other TKMS projects/programs. The CEO corrected the interviewer. The overtones I took from things were TKMS were looking to diversify their industrial base as a hedge against Russian aggression and German economic/demographic headwinds.

Easy to attack German infrastructure from Russia, much hard to attack Canadian infrastructure from Russia.

Their bid on having us build the submarines ourselves reflects that.

---

From a geopolitical and strategic perspective TKMS building submarines in Canada (though fraught with risk) is a power move. It secures a manufacturing base/supply line away from Russia's easy reach into Europe, and does the same for German sub users in Asia against China (Singapore as an example off the top of my head). A number of South American countries also use German subs and this may mean that some of those countries (Chile for example) may be want to use our maintenance facilities.

This will allow Canada to be able to repair and resupply German submarines should their safe harbours come under threat and will allow us to integrate into any future TKMS submarine wins in the supply line.

It meets the criteria I set out in a previous post regarding industrial offsets actually applying to the defence contract it was supposed to work with. Also, outside chance this creates an NSS style continuous build program for submarines. If the RCN is going to become a submarine navy equivalent to the surface navy then this is very important.

Torp manufacturing I think was part of the bid as was Naval Strike Missile manufacturing (Norway threw in some incentives I'm pretty sure).

---

2 points.

1) The boat is not the problem. It's the delivery schedule and capability of TKMS.

Choosing TKMS just allows room for the LPC to say they did something (we usually confuse announcements for deliverables) and leaves them more room to cancel/trim the order as time goes on.

2) While I understand we all have small circles you do not speak for the whole of our submariner community. The members I am talking to are more side eye to this than jumping for joy.

To sum up great announcement, most of are expecting more than announcements though.

Fair enough. The sub circle is pretty small, and I know a few were pulling for KSSIII. Yah proof in the pudding. We'll see how the negotiations work out.

 

[Halifax Tar]

Fair enough. The sub circle is pretty small, and I know a few were pulling for KSSIII. Yah proof in the pudding. We'll see how the negotiations work out.

I'll buy you case of Toller Gold when we have 12 German boats under Canadian colours.

 

[Underway]

I'm curious about that 1 line in that article.

With Babcock have a facility on the WC and Fuhr's announcement later today, I'm wondering if there is a chance that a production facility would be stood up on the WC to cover off the statement in the article.

Oh no, Babcock partnered with Hanwha. And the submarine maintenance community are NOT Babcock fans.

Edit: As for the maint facility, they have the realestate all picked out on the Colwood side of the harbour.

 

[Underway]

I'll buy you case of Toller Gold when we have 12 German boats under Canadian colours.

Buddy, I just want to hang out with you, split a pitcher, eat some wings and swap salty stories. I'm not going to get all hung up on something that will or will not be completed well after I retire. If the contract gets reduced or whatever it gets reduced. It won't be the first or last time.

 

[Halifax Tar]

Buddy, I just want to hang out with you, split a pitcher, eat some wings and swap salty stories. I'm not going to get all hung up on something that will or will not be completed well after I retire.

Fair all around! Lol. I do recommend Toller it's a great pint! Brewed in Dartmouth too!

 

[The Bread Guy]

I hear the transition team is already good to go

 

[ytz]

While I understand we all have small circles you do not speak for the whole of our submariner community. The members I am talking to are more side eye to this than jumping for joy.

The few submariners I know are West Coasters. And they were all rooting for the Korean bid. Both because of the ties it would enable in that theatre and for the VLS cells.

The choice of submarine doesn’t bother me as much as the choice of national partner. Canada is already a fairly close ally of both Germany and Norway through NATO and increasingly as of late, other economic and military partnerships. I personally view deepening of this relationship as a bit of a waste of effort and fundamentally just a continuation of the boring, unambiguous status quo.

Going with the Koreans would have been a bold step into effectively a new partner, given the breadth of their bid and how directly involved their government is. Canada has been talking about pivoting to the Indopacific for years and this would have been concrete proof of such a move. The loss of VLS is also a major kick to firepower aboard the boats, going entirely torpedo launched is rough and very limiting. This is also basically killing any Korean chance of growing their naval exports into the western world, and I would expect they will largely disengage from Canadian procurement in the future. They put everything they had into this make or break contest and seemingly failed, there isn’t anything else they could win in Canadian procurement will come anywhere near the value of this contract.

It seems like Carney is definitely a Europhile after all, we’re more interested in reinforcing an existing relationship compared to diversifying our defence and building new relations.

Very much this. I don't know what the Koreans can bid on after this. The next big tranche of contracts are all army stuff. But the CA has a lot of preferences for European and American kit. That could be even tougher to overcome than the subs. And on the geopolitics of it, I just don't see what the Europeans are really doing for us economically that is material enough to give them this.

The one saving grace is that our order is so large that we should hopefully have substantial influence on the program. Hopefully, DIA and ADM(MAT) are unleashed to throw their weight around a bit.

 

[MilEME09]

It would be very funny if the actual announcement this afternoon contradicts this leaked announcement.

deliberately leak the wrong thing to see who might leak it? I mean Brian lilly says a source told him it will be a mixed fleet. Maybe we have a case of multiple people told different things. See what leaks out to find your leaker

 

[Underway]

The choice of submarine doesn’t bother me as much as the choice of national partner. Canada is already a fairly close ally of both Germany and Norway through NATO and increasingly as of late, other economic and military partnerships. I personally view deepening of this relationship as a bit of a waste of effort and fundamentally just a continuation of the boring, unambiguous status quo.

Going with the Koreans would have been a bold step into effectively a new partner, given the breadth of their bid and how directly involved their government is. Canada has been talking about pivoting to the Indopacific for years and this would have been concrete proof of such a move. The loss of VLS is also a major kick to firepower aboard the boats, going entirely torpedo launched is rough and very limiting. This is also basically killing any Korean chance of growing their naval exports into the western world, and I would expect they will largely disengage from Canadian procurement in the future. They put everything they had into this make or break contest and seemingly failed, there isn’t anything else they could win in Canadian procurement will come anywhere near the value of this contract.

It seems like Carney is definitely a Europhile after all, we’re more interested in reinforcing an existing relationship compared to diversifying our defence and building new relations.

Honestly it probably all came down to "build subs in Canada, more money stays here".

I too was hoping for a shake up. But I can see the through line in the decision process and don't disagree with the points.

 

[Rainbow1910]

Very much this. I don't know what the Koreans can bid on after this. The next big tranche of contracts are all army stuff. But the CA has a lot of preferences for European and American kit. That could be even tougher to overcome than the subs. And on the geopolitics of it, I just don't see what the Europeans are really doing for us economically that is material enough to give them this.

All of the army contracts are almost certainly going to Europe and even if the Koreans had a decent chance at them, they are minuscule in value and effort in comparison to this submarine program.

 

[Rainbow1910]

Honestly it probably all came down to "build subs in Canada, more money stays here".

I too was hoping for a shake up. But I can see the through line in the decision process and don't disagree with the points.

This government seems to be onboard with an increasing number of very questionable pie in the sky domestic industrial investments, so I wouldn’t be surprised that they bit onto a promise such as that in the end.