A senior South Korean delegation headed to Canada on Monday to lobby for a major submarine procurement project, as Seoul intensifies efforts to expand its defence exports and global industrial footprint. Presidential Chief of Staff Kang Hoon-sik is leading the mission alongside executives from Hyundai Motor Group and major shipbuilders Hanwha and HD Hyundai, underscoring the strategic and economic weight Seoul attaches to the bid.
The Submarine Competition
South Korea is competing against Germany’s Thyssenkrupp Marine Systems for Canada’s planned purchase of up to 12 diesel-powered submarines. Industry sources estimate the contract could be worth more than $12 billion. Kang acknowledged the challenge of competing with Germany’s industrial strength but said Seoul aimed to directly demonstrate the performance of its submarines and the government’s commitment to deeper security and industrial cooperation with Canada.
Economic and Strategic Stakes
Kang said winning the project could generate economic benefits exceeding 40 trillion won ($27.6 billion) and create around 20,000 jobs. The bid aligns with President Lee Jae Myung’s pledge to build the world’s fourth-largest defence industry as South Korea seeks to strengthen its military and position itself as a leading global arms supplier amid heightened regional threats from North Korea.
Hyundai’s Role and Canadian Expectations
Hyundai Motor Group Executive Chair Euisun Chung is also joining the delegation, reflecting the importance of industrial offsets in Canada’s decision-making. Canadian officials have previously raised the idea of a Hyundai car plant, though Hyundai said it currently has no plans to build a factory in Canada. Instead, the group said it is exploring broader cooperation opportunities, including in hydrogen and other strategic sectors where Canada has competitive advantages.
Broader Industrial Cooperation
Business leaders from both countries are set to meet in Canada to discuss cooperation across submarines, batteries, and other strategic industries. Hanwha has said it aims to create significant employment in Canada by 2040 through long-term industrial partnerships, while Germany’s TKMS has announced talks with European partners to assemble a competing multi-billion-dollar investment package.
Canada’s Defence Needs
Canada, a NATO founding member with the world’s longest coastline and growing Arctic security concerns, is seeking to modernise its aging four-vessel submarine fleet dating back to the 1990s. New submarines are seen as critical to strengthening underwater surveillance and deterrence capabilities.
What’s Next
The coming weeks are expected to see intensified lobbying from both South Korea and Germany as Canada evaluates not just submarine performance but long-term industrial benefits, job creation, and strategic partnerships. Further discussions on offsets and cooperation will likely shape Ottawa’s decision timeline, with the project emerging as a key test of South Korea’s ambition to become a top-tier global defence exporter.
With information from Reuters.
