Unable to open the link provided. Tried both Brave and MS Edge browsers.
Germany vs. South Korea – Who builds Canada's submarines?
South Korea and Germany are competing to supply the Canadian Navy with up to twelve submarines for more than ten billion euros. But the order is about much more than just ships. That's why Volkswagen and Hyundai are also involved in talks.
For Canada's Industry Minister Mélanie Joly, the visit to Berlin a few days ago apparently went well. First, the liberal politician met the head of the Volkswagen Group, Oliver Blume, in the capital representative office of the company Unter den Linden. Later, she was received by Federal Minister of Economics Katherina Reiche (CDU) at the ministry's headquarters in Chausseestraße.
There, the two ministers signed a "Declaration of Intent to deepen dialogue and cooperation in the field of automobile and mobility". The "proud car nation" Canada is thus attracting "major investments in municipalities throughout the country," Joly said afterwards.
Whether the visit was also worthwhile for Germany will only become clear in the coming weeks. Because in the background, it was less about cars and more about another product of German industry: submarines.
The Kiel-based arms company TKMS is applying for a contract from the Canadian government for the construction of up to twelve diesel-powered submarines. The contract is estimated by industry experts at more than ten billion euros. In addition, there are decades of maintenance orders.
The deadline is March 2. On that day, TKMS will make a so-called non-binding offer to the Canadians for the sale of the twelve non-nuclear ships of the class 212CD. The last remaining competitor in the race for the deal is South Korea with the company Hanwha Ocean.
So the question is: Germany or South Korea? Who is awarded the armaments contract depends not only on the price. But apparently also on whether the German or South Korean car industry will invest more in Canada in the next few years.
The Canadian newspaper "The Globe and Mail" had reported that the government had asked the two countries to "make production commitments for the automotive industry in Canada as part of their bids". South Korea responded with a corresponding declaration of intent at government level. Germany followed suit with the paper, which Joly and Reiche signed in Berlin.
The German Minister of Economic Affairs had previously visited her counterpart in Canada at the beginning of February. At that time, Reiche had told the Globe and Mail that the interest of the German automotive industry was independent of the submarine offer. "You can think of it as connected to a certain business, but I wouldn't do that," she said.
However, she admitted that talks were held with the automotive industry. "I know that it is of great importance for Canada to regain manufacturing production and jobs, especially in the automotive industry. That's why we started talking to our automotive industry (...) and the Canadian government about what investments could be made," said Reiche.
Talks with VW and Hyundai
The Koreans have done the same. At the same time as a high-ranking government delegation, the CEO of Hyundai Motors had visited the country and the government of South Korea agreed on a similar declaration of intent on cooperation in the auto industry with Canada as Joly and Reiche.
However, neither VW nor Hyundai have concrete plans to build a car factory in Canada. There is currently no need for this in the North American market. At least Volkswagen can throw its major project in the small town of St. Thomas into the balance: The Germans are building their world's largest battery cell factory there. And Canada is also likely to play an important role for VW in the purchase of raw materials in the future.
This also applies to the Federal Republic of Germany as a whole. Politicians are correspondingly active: Defense Minister Boris Pistorius (SPD) was in Ottawa before Reiche, and Chancellor Friedrich Merz (CDU) had Prime Minister Mark Carney visit Berlin. Government representatives from Norway are also promoting the deal. The Scandinavians have already ordered submarines of the class 212CD from the M-Dax group TKMS.
"We are also working here with other companies in the German and Norwegian economy to put together a broader economic package," said TKMS CEO Oliver Burkhard at the presentation of the annual balance sheet. In addition to the automotive industry, this also involves areas such as rare earths, mining, artificial intelligence and battery production.
Previously, TKMS and the Canadian side had already signed project agreements in the maritime sector as further support, such as a cooperation with Seaspan Shipyards on the maintenance of the Canadian submarine fleet or the launch of the Canadian Defence & Dual-Use Innovation Ecosystem, an initiative to strengthen Canada's ability to translate cutting-edge research into deployable defence solutions and scalable civilian applications.
The offer that has now been prepared will be examined by the Canadian side after submission at the beginning of March. Open questions can still be clarified. A spokesman for Industry Minister Joly declined to comment on the ongoing proceedings. "The procurement process for the Canadian patrol submarine project is currently underway, and we cannot provide any information on the content and status of the economic offers of potential suppliers," he replied to a request from WELT. VW also did not want to comment.
A decision on the submarine deal is to be made by the summer, according to those involved. "After that, the final contract negotiations will be started with the selected provider," says TKMS.
battlefordsnow.com
