The proposed measures would advance a broader strategic partnership that calls for Canada and Europe to assume greater responsibility for shared security while reinforcing NATO. The draft, first reported by Politico, does not announce new troop deployments or weapons purchases.

Under the current wording, Canada is promised negotiations for access to services from Europe’s Galileo satellite constellation, as well as exploring Canadian participation in the European IRIS² satellite communications project. 

Canada’s vast natural resources appear to be of particular interest to Brussels, with an entire section dedicated to energy and critical raw materials. The draft proposes exploring stockpiling of critical resources needed by civilian and defense industries to cushion supply chains against market fluctuations and geopolitical disruption.

There’s already some dissonance about some specific wording. In mid-September, European Commission President Ursula  von der Leyen announced her plan to make Canada the EU’s first “associate member” –  to the surprise of some European capitals. Now, the draft joint document for the ongoing summit has removed this language, speaking instead of an “ever-closer association of Canada to the EU, short of full membership itself.”

Canada is choosing not to get caught up in the war of terminology, with Politico quoting Carney as saying that “the good news is it doesn’t matter about specific names or nomenclature.” 

Two key unifiers have driven Europe and Canada closer together: Russia’s war against Ukraine, and U.S. President Donald Trump. Canada launched Operation Reassurance in 2014 following Russia’s invasion of Ukraine and has led NATO’s multinational battle group in Latvia since 2017. Cooperation and coordination deepened further after Russia’s full-scale invasion of Ukraine in 2022. 

Trump’s threats against NATO, Europe and Canadian sovereignty alike have accelerated the integration process. Particularly the Arctic has emerged as an area of interest. In February, Canada and Denmark signed a memorandum on defense cooperation amid Trump’s insistence that Greenland become a part of the United States, having threatened military force. Pointedly, the agreement with Ottawa was signed with Danish, Greenlandic and Faroese delegates present. It covered innovation, industrial cooperation, mutual logistics support, personnel, training and exercises. 

And in March, Canada, Denmark, Finland, Iceland, Norway and Sweden held a summit in Oslo that laid the cornerstone for an Arctic-centric, security-focused format and concrete actions to secure an area that these countries increasingly perceive as a zone of joint security interests, especially vis-à-vis Russia and, to a lesser extent, China. 

Finland and Norway also separately signed Arctic security-themed agreements with Canada in April and March, respectively, covering intelligence sharing, interoperability, logistics and maritime topics like the building of icebreakers, among other topics. 

In July, Canada announced its intention to buy up to twelve new German-Norwegian submarines, preferring the European boats over a South Korean offer, just a few weeks after Ottawa singled out Sweden’s Saab as the preferred candidate to supply it with six new airborne early warning and control aircraft. 

Around the same time, Canada secured preferential access to procurement under the EU’s Security Action for Europe (SAFE) defense-financing program, allowing Canadian-origin components to account for up to 80% of the procurement value of equipment purchased with its loans.

Saab confirmed Oct. 27 that it has formed alliances with several firms to build, deliver and support the Gripen E advanced multi-role fighter, should the Canadian government purchase the plane.

Canada had already committed to buying 88 Lockheed Martin F-35s but that is under review after U.S. President Donald Trump threatened to economically cripple the country and suggested it could be annexed to be the 51^st state. At this point Canada has paid for 16 F-35s.

Two of the aircraft were transferred to Canada on Oct. 9 and Oct. 22, said Department of National Defence spokeswoman Andrée-Anne Poulin.

Canadian Prime Minister Carney will decide whether the rest of the F-35s will be purchased but he has not indicated when he would announce his decision.

In the meantime, the Canadian government is examining whether it should purchase the Gripen E, either as an alternative to the F-35 or to complement the U.S. fighter jets. Saab has responded by forming a teaming arrangement with Canadian firms CAE of Montreal, Quebec; IMP of Halifax, Nova Scotia; and Magellan Aerospace of Mississauga, Ontario.

“Together with CAE, IMP and Magellan Aerospace we are prepared to establish a strong Canadian industrial ecosystem around Gripen that delivers operational effect, national sovereignty and lasting industrial and technological benefits,” Micael Johansson, President and CEO of Saab, said in a statement Oct. 27.

Saab noted it has signed a teaming agreement with IMP to establish a new final assembly line, for the Gripen fighter in Canada, if Canada decides to acquire the aircraft. IMP will also be responsible for electrical assembly production and in-service support for Canada’s Gripens.

Saab has also signed a new Memorandum of Understanding with Magellan Aerospace to provide local manufacturing of advanced aerostructures, composite structures and structural assemblies in Canada — again, if Canada decides to acquire the aircraft.

Saab has previously signed a Memorandum of Understanding with CAE to deliver advanced fighter pilot and technician training, mission systems engineering and support/sustainment capabilities in Canada.

Saab has already made significant inroads into the Canadian market.

Carney announced May 27 that Canada will purchase six GlobalEye early warning and control aircraft from Saab as part of deal to not only boost Canadian military capabilities but energize domestic defense production.

Carney said the proposed GlobalEye purchase is estimated to cost more than $5 billion CAN ($3.6 billion).

GlobalEye is based on a Bombardier 6500 executive jet, an aircraft that is manufactured in Toronto. Carney said that at least one-third of the projected GlobalEye aircraft orders for various allies will be built in Canada. That is expected to be 40 aircraft over the next 15 years.

On Sept. 25 the Canadian government announced it had worked out an agreement with Saab that will provide the framework for upcoming negotiations on the purchase of the six GlobalEyes.

In announcing the agreement, Stephen Fuhr, Secretary of State for Defence Procurement, said Canada will be focusing on pursuing a partnership that supports “Canadian jobs, innovation, and long-term economic growth while ensuring we acquire capabilities from trusted partners when they are needed.”

To his likely irritation, hordes of uniformed soldiers had gathered beneath the petite primate, filling his muddy underbrush with the heaving sound of heavy rucksacks and the smell of body odor that had been brewing in the moist terrain for days.

The soldiers, some wearing days-old green face paint, had congregated amongst the moist fauna to complete their final task in the U.S. Army’s Jungle Operations Training Course in Panama: The Green Mile.

The notorious event — in the thick of Panama’s “Green Hell” — is the 18-day course’s culminating exercise, testing participants’ newly learned jungle maneuver techniques, survival measures and fighting skills.

By that point in the course, the soldiers had run a days-long jungle reconnaissance and attack operation. That portion of the field exercise was complete, and perhaps to the howler monkey’s dismay, so were the soldiers’ attempts to stay quiet.

The course in 2025 returned to Panama at Base Aeronaval Cristóbal Colón, formerly known as the U.S. Army’s Fort Sherman, decades after it was originally shuttered.

The new course is a joint U.S.-Panamanian partnership, with Panamanian instructors leading lessons on jungle survival.

With staggered start times, each squad took off running down a soggy, uneven path. Squads in the September course had participants from across the U.S. force, including those from the Army, Marine Corps and Space Force.

Some squads had Panamanian soldiers. Other countries, such as Colombia, have expressed interest in sending soldiers in the near future.

In classes with Panamanian students, instruction is given in English and Spanish. When the course is English-only, the duration shrinks to 12 days, but without partners, officials say U.S. students can miss out on opportunities to connect with other forces.

Spc. Duncan Vaupel, a member of September’s jungle school course, said he talked with and learned from Panamanian troops who described treating soldiers who had lost legs and fighting gun battles in the jungle that stretched into the night.

“These guys not only teach it, but they live and breathe it, too,” he said.

The squad’s first major Green Mile task was to carry some of the service members’ rucks in a litter made from whatever they could find. Logs or long branches coupled with issued wet weather equipment — a poncho — did the trick.

During the course, participants are provided instructions on jungle first aid. They also practice with medical evacuation helicopters, transporting a casualty to some sliver of open sky where a medical team can send a rappel line down to hoist the injured soldier up. Jungle landing zones are few and far between.

Sgt. 1st Class Timothy Reeves, a combat medic and an instructor at the school, said that heat injuries are common because of the oppressive humidity and temperature.

Animal-related injuries are also widespread, he said. Wild, territorial bees are sensitive to loud noises and will defend their hives by attacking the camouflaged intruders.

“We do have wild bees down here that tend to get a lot of the students as they move throughout the jungle,” Reeves said. “I know we’ve had to evac a handful of students before to the aid station for bee stings, scorpion stings and a variety of insect bites.”

Once the section of muddy pathway came to an end, there was the sea to deal with.

Muddy boot after muddy boot sank into the swirling sand beneath unforgiving waves. Soldiers were instructed to file one behind the other, sometimes sinking waist-deep into the water as they skirted rocky outgrowths and navigated dense mangroves.

Fewer troop formations work in a jungle environment, said Lt. Col. Andrew Eagan, who oversees the Jungle Operations Training Center. Wedge formations, for example, do not work, he said.

“Here you fight in a column, you fight in a line, and the reason for that is the environment,” Eagan said. “The environment is so punishing.”

When the Green Mile took the service members back inland, the soldiers traded the wet coastline for brutal terrain.

Their next challenge? A hill so steep that it required crawling on hands and knees. With a grade impossible to climb with waterlogged rucks, the scrappier soldiers scaled ahead, breathlessly anchoring a rope bridge from the top so other soldiers could cling to it as they ascended while lugging the squad’s wet gear.

Soldiers slipped, ripping pants and filling scraggly fingernails with brown mud. Weapons became caked with slippery earth as they reached the peak.

During Eagen’s interview, he said Panama’s environment was the part of jungle school that U.S. students underestimated most. During The Green Mile, the true magnitude of the jungle’s hazards was revealed — relentlessly.

There was no walking down the other side of the hill, for instance. Course participants scooted or slid down on their rears, praying that their nether regions would not cross the path of a black palm — one of the treacherous plants students learn about in the jungle, in addition to the school’s flora and fauna blocks of instruction.

With pointy spikes that can reach up to 8 inches long, flaring from every inch of its trunk, soft flesh is no match for nature’s black needles.

Other plants, students learn, are edible and can help them survive in such harsh environs. Some of nature’s bounty, however, keeps the jungle students’ digestive systems unusually active.

2nd Sgt. Rubén Rodríguez, a Panamanian instructor for the course, said American students are often particularly hungry. They love to pick and eat coconuts for extra nourishment, he said.

Though delicious and healthy in moderation, coconuts can be laxatives in large quantities. The Americans’ frequent snacks, Rodríguez said, send them straight to the jungle bathroom.

As the troops progressed through the course, lanewalkers added full water jugs and ammo cans to soldiers’ loads. The extra weight pushed boots even deeper into the muddy ground.

Red-faced and exhausted, the squad hoisted the extra weight over and under the first leg of an obstacle course that represents the final, brutal stretch of the Green Mile.

The squad dragged themselves — and their equipment — through sticky, brown goop as they low-crawled beneath barbed wire. Soldiers tossed gear over a high wall before hurling their own bodies over after the dumped equipment.

Before the finish line, the squad trekked up another uneven hill — even more slowly than any hill they had summited before.

Once they hit concrete — and the familiar terrain near the schoolhouse’s campus — the jungle-battered squad had just minutes to sprint the last stretch of what was actually a four-plus-mile endeavor.

The instructors imposed a time cap on the event (because what is Army training without the addition of some artificial stress?).

As the afternoon sun beat down on the squad, the sprint slowed to a heavy shuffle.

One participant, who had been carrying extra weight, stifled a gag as he trod onwards.

In a haze of instructor-cracked purple smoke, the squad finished, collapsing in a heap under the shade of a cluster of trees.

Some soldiers emptied the water jugs over each other’s heads. Others lay spread-eagled in a lukewarm puddle of mud.

Two participants — one with a ripped pant seam exposing a dirty, pale leg — reveled in their success.

“It was a good time,” one said, looking at his friend.

After a millisecond of hesitation, the friend responded.

“Nah,” he said, shaking his head with a smile.

In a social media post, Trump also slammed reports of heavily depleted U.S. munition stockpiles amid the separate war in Iran, while adding that the United States was ramping up production and stockpiling munitions.

“We are taking them for ourselves, the U.S.A., rather than selling them to others, but the sales to allies will soon again, begin,” Trump wrote.

“Hundreds of Billions of Dollars was given to Ukraine and NATO, free of charge, that Europe would have paid for — If they were only asked, but we will be asking for that money, though somewhat belatedly!” he added, blaming the administration of his Democratic predecessor Joe Biden.

Last year, the United States and NATO developed the Prioritized Ukraine Requirements List initiative, under which European countries pay to supply Ukraine with U.S. weapons.

Reuters reported last month that the U.S. Army has used up much of its stockpile of highly accurate long-range missiles during the Iran war, raising concerns about the military’s readiness for future conflicts.

Both the wars in Ukraine and Iran — and their economic shocks — could impact whether Trump’s fellow Republicans maintain control of both chambers of the U.S. Congress next year.

On Thursday, oil prices hit fresh six-week highs as the latest U.S. strikes on Iran and renewed ‌Israeli threats against Tehran revived concerns about disruptions to Middle East supplies as vessels remain throttled in the Strait of Hormuz.

U.S. Treasury Secretary Scott Bessent on Wednesday sought to partly blame Kyiv’s recent strikes against Russian energy targets for rising oil and gas prices.

“We are going through an energy shock right now due to both the war in Ukraine – because, you know, Ukraine has decided that they want to blow up Russian energy assets and refined products, so that is creating upward price pressure on a global basis – and then the conflict in Iran,” he told Fox News in an interview.

Companies in the United States and Europe rode a wave of significant defense-spending increases on both sides of the Atlantic. In Europe, individual national budget increases, as well as the European Union’s increasing involvement in brokering and financing joint procurement, continued to increase the revenue of defense industry players large and small.

In the United States, the 2025 Reconciliation Act is set to pump most of the legislation’s total $156 billion into acquisition — on top of the regular defense budget of roughly $900 billion for that year.

“Now, it’ll take years for that enacted money to actually flow to the companies and to their financial statements,” said Mark Cancian, a senior adviser in the defense analysis program at the Washington-based Center for Strategic and International Studies. “But it will be a big boost for many companies.”

Click here to view the 2025 Defense News Top 100

In Europe, the trajectory is perhaps more immediate, as governments spooked by Russia’s full-scale invasion of Ukraine in February 2022 began dialing up their military expenditures drastically years ago.

Besides absorbing the overall plus-up in the amount of money available, companies on the continent have rewired their business strategies to align with a preference for European-made equipment by many European governments, though the massive influx of cash on all sides obfuscates whether European companies have meaningfully cut into the bottom lines of U.S. defense giants.

More money on both sides of the pond

The latest Defense News Top 100 ranking of global defense companies bears out the overall upward trend, with companies posting higher annual defense revenues, a combined $700 billion compared with $629 billion in the prior year, a 11.3% increase.

The first four spots of our latest ranking continue to be in the hands of U.S. firms, with Lockheed Martin in the top spot with $72.1 billion in annual defense revenue, followed by RTX ($46 billion), General Dynamics ($39.4 billion) and Northrop Grumman ($37 billion), in that order.

Britain-based BAE Systems, which has a sizable U.S. operation, is the first non-American company in the lineup, creeping up one spot into number five over last year’s ranking, with $36 billion in revenue reported.

Boeing’s defense segment similarly climbed one position, into slot number six with $35.7 billion in revenue, as did L3Harris ($17.4 billion), which now places eighth.

In between sits a Chinese entrant, Aviation Industry Corporation of China, at $32.3 billion.

Click here to view the 2025 Defense News Top 100

On the heels of that company begins a lineup of firms from all over the world, with European outfits continuing to inch upwards — the big players Leonardo, Airbus and Thales placing 9, 10 and 12, respectively.

Perhaps no company represents the European defense uptick as much as Germany’s Rheinmetall, which reported $11.2 billion in 2025 annual revenue, up from $8.3 billion in the previous year. The company now sits at number 15 on the list, up from 18 in the prior year.

The firm has, over the years, branched out its operations into virtually all domains of war — land, air, naval, space, cyber and unmanned — from Europe to Australia, and has embraced the formerly low-brow segment of explosives and ammunition.

That category, which includes artillery shells, missiles and air-defense interceptors, has seen unprecedented demand in all NATO countries, based on the experiences since Russia’s full-scale invasion of Ukraine in February 2022.

Air defense competitions on the rise

The air defense category is also where the biggest shortfalls lie. Companies have expanded their supply chain setups in recent years to build artillery shells, urgently needed in Ukraine to shoot over immediate front lines’ robot-dominated no-go zones for infantry.

But what’s still lacking are sufficient interceptor missiles and drones to defend against Russian missiles fired at Ukrainian cities.

With the Patriot air defense complex — radars, launchers and interceptors — in the hands of U.S. firms, European and Ukrainian officials have begun thinking through alternatives to the scarce equipment.

Offerers include the Israeli companies involved in that country’s anti-missile architecture, with Elbit ranking 21 on the list, Israeli Aerospace Industries at 27 and Rafael at 30, as well as pan-European firm MBDA at 26 and Germany’s Diehl at 58, up from 82 last year.

Companies with a naval shipbuilding portfolio, such as General Dynamics, Huntington Ingalls (ranking 13, at $12.3 billion annual revenue, up from 16) and South Korea’s Hanwha (rank 16, at $10.4 billion, up from 22), have been lifted by a favorable tide of capital-intensive naval modernization projects worldwide.

In the U.S., defense officials and lawmakers have envisioned a new armada of warships and icebreakers, dedicating a whopping $29 billion for shipbuilding in the 2025 Reconciliation Act alone.

“The Biden administration, and now the Trump administration, have just been pouring money into shipbuilding — way beyond what the industry can absorb,” said Cancian. “And then they’re talking about building another shipyard to produce all these ships that have now been funded,” he added, leaving shipbuilders with order books filled into the 2030s or beyond.

Defense spending as an ‘engine’?

Production bottlenecks for defense components, combined with economic woes in civilian industry sectors, have led to some new creative arrangements.

In Europe, some automotive companies and rail car makers have turned their factory floors into production sites for drones and counter-drone equipment.

The rush to re-arm, based on the worry that Russia might try a Ukraine-style attack elsewhere, has prompted political leaders in Europe to tout what they consider secondary economic effects of the defense bonanza.

Defense officials in the U.K. published figures in August, for example, that said the 2024-25 period saw British weapons and ammunition manufacturing jobs rise by 51%, “part of a wider 26,000 increase” in defense-supported roles nationwide.

Click here to view the 2025 Defense News Top 100

“The increase underlines defense as an engine for growth and the move towards a resilient industrial base, proving that investment in the U.K.’s security is investment in the U.K.’s prosperity,” reads an Aug. 20 statement by the Ministry of Defence.

Some Turkish companies, meanwhile, representing a country with a government mandate for making defense equipment at home rather than importing it, made the latest Top 100 list again, improving positions in some cases. Aselsan jumped from spot 43 to 40 on roughly $4.5 billion in reported annual revenue, and Roketsan gained seven ranks, on $2.4 billion, landing at spot 64.

Similarly, Polish state-owned armaments group PGZ jumped from rank 54 in 2024 figures to number 41 in the latest accounting, based on $4.4 billion in revenue last year.

The Polish government has set out plans to create one of NATO’s most powerful armies in Europe, and local weapons programs are typically designed to include Warsaw’s go-to producer as a key partner.

Meanwhile, the collection of Ukrainian defense companies under the umbrella of Ukroboronprom improved their ranking to spot number 36, up from 49 last year, with a reported revenue of $4.6 billion in 2025.

The country’s defense industry over the past years has put the Kyiv government in a position to provide armaments to its forces that the country previously had to import, often with operational limitations attached.

So much has the Ukrainian defense industry gained in expertise that allied militaries are itching to incorporate its know-how into their own supply chains.

Looking ahead, there is more spending expected, and more business for relevant defense companies, in the field of air and missile defense, said Cancian. Much of that will be connected to whatever the Trump administration’s Golden Dome program will entail, he noted.

Golden Dome wildcard

The controversial Golden Dome effort will consist of a sweeping suite of sensors and interceptors — stationed on Earth, in space and everywhere in between — that would make the United States almost impervious to aerial attacks of any kind, the theory goes.

Details have been scant on its exact architecture, and companies are searching for avenues into what they suspect will be a generational chunk of government spending in the hundreds of billions of dollars.

“We still don’t really know what it is,” Cancian said, adding the lack of clarity could make the whole project an increasingly hard sell as time goes by.

On the whole, the analyst said, there is so much defense spending on the books that the U.S. government, for its part, isn’t forced to choose between buying legacy weaponry and new technology.

“The thing that struck me most — I come out at this from a program budget perspective — is that there was enough money to do both,” he said.

Turning the influx of defense money into meaningfully improved defenses will be a top oversight job for politicians. And industry will have to be disciplined to get its ducks in a row to contend with order backlogs and production bottlenecks.

As PricewaterhouseCoopers analyst Scott Thompson noted in a recent performance analysis of the aerospace and defense sectors, “In a market where demand is not the constraint, execution is the differentiator.”

The move coincides with the Farnborough Airshow, the aerospace and defense industry’s premier gathering, with wars in Ukraine and the Middle East driving demand for tools from combat drones and interceptor missiles to AI-enabled military software.

The airshow coincides with new Prime Minister Andy Burnham’s first days in office. He named John Healey, who favors hiking the UK defense budget, as finance minister, while giving Health Minister Wes Streeting the defense brief.

The appointments boosted British defense and aerospace stocks on Tuesday, as markets bet companies would benefit from the new government’s willingness to make Britain more war-ready.

“I’m looking forward to working with him in his new capacity,” Rolls-Royce CEO Tufan Erginbilgic told reporters at the show on Tuesday, referring to Healey. “He understands Rolls-Royce and our agenda and how much we contribute to the country.”

The new government’s first announcement with foreign partners came on the Global Combat Air Programme, the stealth fighter being jointly developed by Britain, Italy and Japan. Canada joined as an observer, marking the first expansion beyond the founding members.

BAE Systems, Boeing and Saab also signed a deal to advance a partnership to offer Britain a new fast-jet pilot training aircraft based on Boeing’s T-7 system, as it looks for a replacement for the aging Hawk fleet.

Defense sector signal

Healey had previously spent months lobbying the former prime minister to lay out a pathway to spend 3% of GDP on defense by 2030, rather than the 2.68% that the government eventually budgeted for.

“As Defense Secretary, John Healey championed British business, recognizing the contribution that the defense sector makes to growth and national security,” BAE Systems CEO Charles Woodburn said.

Canada is becoming an increasingly important defense partner for European nations as it looks to diversify its defense spending away from the United States and forge closer ties on the continent.

There will be no financial commitment involved in its observer status, but Canada could join the program more formally in future, sharing the billion-dollar development bill and potentially ordering the jets.

Defense companies made up half of a record 1,600 exhibitors at this year’s show, highlighting a shift from the usual dominance of commercial aviation and reflecting how conflicts have reshaped spending priorities.

The contract, worth almost $2 billion CAN (US$1.4 billion), was awarded to General Dynamics Land Systems-Canada, based in London, Ontario. Canada will also pay for GDLS-Canada to build another 35 armored combat support vehicles for Ukraine, said Canadian Prime Minister Mark Carney, who announced the deal on July 16.

Canada had previously donated 89 such vehicles to Ukraine.

The new purchase will see the Canadian Army’s wheeled light armored combat support vehicle fleet increase from 360 vehicles to 550 vehicles.

GDLS-Canada was originally awarded the contract for the first 360 armored combat support vehicles in August 2019. Those vehicles have already been delivered.

ACSVs have eight variants – ambulance, command post, troop/cargo, electronic warfare, maintenance and recovery, mobile repair team, fitter/cargo, and engineer. They are all based on the GDLS-Canada’s Light Armored Vehicle 6.0 platform, which helps the army reduce training and sustainment costs. ACSVs are currently deployed with the Canadian-led NATO Multinational Brigade in Latvia.

Carney also announced that GDLS-Canada has been designated as the first strategic partner under his government’s newly established Defence Industrial Strategy’s framework. That framework puts emphasis on buying defense equipment from Canadian-based firms.

“Through this framework, we’re creating a pathway for Canadian companies like GDLS-Canada to work more closely with our government to build those sovereign capabilities: the armored vehicles, the drones, the icebreakers, the equipment that our armed forces need,” Carney said in a televised news conference from the GDLS-C plant.

The framework requires companies to commit to investing in Canadian research and development, hiring domestic workers and expanding their domestic supply chains. “In return, the federal government will act as an anchor customer — accelerating approvals and opening doors to new export markets,” Carney said. “The commitment is simple: when Canadian companies build for Canada, Canada will build with them.”

Carney said the construction of armored vehicles at GDLS-Canada involves more than 600 Canadian suppliers.

Carney launched the defense industrial strategy framework in the aftermath of U.S. President Donald Trump’s decision in 2025 to hit Canada with significant tariffs as well as other threats of economic punishment. Trump has warned that the only way Canada could escape such economic measures would be to become a 51^st state.

As a result, Carney noted that Canada needed to reduce its alliance on the U.S., particularly in regard to U.S.-built military equipment. “We should no longer send three-quarters of our defense capital spending to America,” Carney said June 9, 2025.

He left the door open to working with U.S.-owned firms, such as GDLS-Canada, as long as they made an economic commitment to Canada.

GDLS-Canada vice president and general manager Dave Haggerty welcomed the strategic agreement between the firm and the Canadian government. “Our team takes great pride in the opportunity to provide Canadian soldiers with the advanced combat vehicle platforms and support they need to succeed, while continuing to strengthen Canada’s sovereign capabilities, its defense industrial base, and skilled workforce,” Haggerty said in a statement.

Blue Water Autonomy and Saildrone allege they were kicked out of contention for the Navy’s Medium Unmanned Surface Vessel Family of Systems program after the Navy failed to comply with its own requirements, among other errors.

Blue Water Autonomy said the decision was based on “overly restrictive evaluation criteria, a misreading of Blue Water’s proposal, and irrational conclusions that are inconsistent with the [Request for Prototype Proposals] and statutory requirements,” according to a complaint filed in the U.S. Court of Federal Claims.

A significant portion of both companies’ legal documents were redacted, and the specifics of what the Navy found lacking in each of their MUSV proposals was not immediately clear.

The Navy said it could not comment on pending litigation.

The service launched the MUSV program and opened solicitations for the new class of boat on March 26, after canceling the Modular Attack Surface Craft program.

The latter, announced on July 28, 2025, solicited the development of USVs that were capable of carrying large containerized payloads that could accommodate a similar weight to the Navy’s anti-ballistic missile system, the Mark 70 Mod 1 Payload Delivery System.

The MASC program was dedicated to a specific mission and specific ask from the fleet, whereas the MUSV program addresses a larger batch of requirements and mission types.

This was the reasoning behind the shuttering of the MASC program, according to Rebecca Gassler, portfolio acquisition executive for the U.S. Navy’s robotic and autonomous systems.

The MUSV solicitation, which ended on April 17, analyzed a company’s business plan, manufacturing plan, test plan and technical design.

Chosen companies and their MUSVs were then instructed to prepare for an on-water test with a surrogate vessel that would be conducted at the end of the fiscal year.

Blue Water Autonomy was initially chosen by the Navy to participate in the Modular Attack Surface Craft program before the MUSV program was rolled out.

The company was already underway in developing its Liberty vessel for the MASC program when it ended, having sunk money into production.

But before Blue Water Autonomy could participate in the on-water test with a surrogate vessel to demonstrate its viability as a partner for future MUSVs, they say they were barred from continuing in the MUSV program competition.

The Navy announced on June 1 that it had selected seven companies to participate in at-sea testing.

Those companies included Sea Machines, Leidos, Saronic Technologies, Galliano Marine Services, PacMar Technologies, Birdon and Huntington Ingalls Industries.

Blue Water Autonomy was not on the list.

The company said the Navy’s decision to remove it from consideration for the MUSV request for prototype proposal was “capricious” and not “in accordance with statute or regulation.”

The complaint asked that the Navy halt the testing and funding for the MUSV program until “prejudicial errors” were remedied and Blue Water Autonomy was allowed reentry into the program in an effort to win the bid for the MUSV contract.

Saildrone was also excluded from participating in the program after initially taking part.

The company argues that it was more than deserving of being in the mix for the MUSV program, as it operates the world’s largest fleet of contractor-owned, contractor-operator USVs which have completed upwards of 2.5 million nautical miles since 2012, according to a complaint filed in the U.S. Court of Federal Claims.

“Our fully compliant MUSV submission to the US Navy should have qualified for advancing to the next round, in which we would participate in sea trials and develop a prototype at our own cost,” a Saildrone spokesperson said. “We support the Navy’s mission and believe there has been a misunderstanding in the evaluation of our bid.”

Saildrone has deployed more than 70 vessels across the globe, including for the Navy and U.S. Coast Guard, the complaint said.

The company said it learned it was disqualified from continuing to compete in the MUSV program from a news article and was offered no explanation in an email follow-up with the U.S. government as to why it wasn’t given an opportunity to continue.

Eventually, Saildrone says they were provided a “fundamentally flawed evaluation.”

“Because advancement to the on-water test event imposes no material financial obligation on the government, reevaluating Saildrone’s proposal consistent with the solicitation and advancing Saildrone furthers the public interest at no meaningful cost,” the complaint said.

Saildrone asked to be reinstated in the competition and allowed to compete in the on-water test.

The fiscal 2027 Navy budget calls for the procurement 63 unmanned vessels.

President Donald Trump’s One Big Beautiful Bill Act contains $2.1 billion for medium unmanned surface vessels, a Navy official told Military Times in March.

Trump is scheduled to participate in a roundtable discussion capping a two-day Defense and Innovation Summit hosted by Republican Senator Dave McCormick at the U.S. Army War College in Pennsylvania. The event gathers senior military leaders, defense contractors, investors and technology executives to discuss strengthening the U.S. industrial base and speeding the delivery of advanced weapons systems.

Trump’s appearance underscores a broader focus by the administration on defense production as prolonged conflicts have consumed large quantities of missiles, interceptors and other weapons, while highlighting the limits of the U.S. military supply chain and production capacity. Trump is expected to make several Pennsylvania-based defense investment announcements.

Joint Chiefs of Staff Chairman General Dan Caine urged defense companies on Tuesday to accelerate production and innovation, saying the military needs industry partners to help deliver capabilities faster as warfare evolves.

“What I need you to know, and I know this is simple for me to say, but hard to do, is to go faster. Please go faster. Think bolder,” Caine said.

Broader industrial strategy

For Trump, expanding defense manufacturing has become part of a wider economic strategy to revive U.S. industrial capacity, with the Pentagon increasingly viewed as a catalyst for factory investment, advanced manufacturing and domestic supply chains.

In late June, Trump met with munitions makers at the White House to urge the industry to move faster.

The United States has supplied large quantities of weapons to allies while also using munitions in its own military operations, raising concerns about inventories of key air-defense and precision-guided weapons and increasing pressure on contractors to boost output. Soaring demand for rocket motors used to power missiles and other weapons has spurred new thinking about supply chains.

Seeking big returns, Silicon Valley-style startups are now taking on defense companies that have long dominated the industry, pulled into the competition by a need for production speed, high volume and lower costs. Legacy solid rocket motor makers Northrop Grumman and L3Harris say they have been pushing their own research and development to pull in new technologies like 3D printing and new mixing technologies.

Michael Duffey, who oversees buying for the Pentagon, told the summit audience that the department is using long-term procurement contracts to give defense companies the confidence to invest billions of dollars in expanding factories, citing roughly $20 billion in private investment tied to plans to boost production of Patriot missiles and other high-demand weapons.

“The global environment now demands that we produce at this scale, at this speed, at this volume,” he said.

Canadian Prime Minister Mark Carney announced July 6 that TKMS has been selected as the winning bidder in the country’s project to acquire the new boats. The company offered Canada its Type 212CD submarine which is being built for both Germany and Norway.

Carney did not provide a dollar figure on the submarine project but noted the deal is expected to be the largest defense procurement in the country’s history. It is estimated that the entire project could cost as much as $70 billion ($100 billion Canadian) when long-term maintenance, new infrastructure, weapons and other factors are considered over the life of the boats.

Negotiations with TKMS will begin shortly with a contract expected to be in place by the end of the year.

TKMS beat out a bid from Hanwha Ocean, which was offering its KSS-III submarine.

“This was a difficult, close decision between two highly qualified suppliers,” Carney said in making the announcement in Halifax, Nova Scotia. “Both the TKMS and the Hanwha platforms met the very high capabilities of the Royal Canadian Navy, and both of them put forward strong proposals to maximize benefits for Canadian workers and businesses.”

“These subs will strengthen our defense industrial base, they will deepen our partnerships with trusted allies, and they will open new opportunities for Canadian businesses in European supply chains,” he added.

The new submarines will replace the Royal Canadian Navy’s aging Victoria-class submarines. Government officials said the first submarine is expected in 2033 with three more hopefully being delivered in 2034.

“In the end, this decision was about choosing the absolute best platform and partnership to meet Canada’s combined strategic, security and economic interests,” Carney said.

Carney made the announcement the day before the NATO Summit is set to begin in Turkey. “These subs will strengthen our defense industrial base, they will deepen our partnerships with trusted allies, and they will open new opportunities for Canadian businesses in European supply chains,” Carney said.

Oliver Burkhard, CEO of TKMS, said in a statement that the company is ready to provide Canada with significant economic benefits. “We stand ready to work alongside the government of Canada, Canadian industry and our partners in Germany and Norway to deliver a world-class submarine capability that will strengthen security, create economic opportunity and generate lasting benefits for future generations,” Burkhard said.

Glenn Copeland, CEO of Hanwha Canada, said the company was disappointed with its loss but he noted that the competition showed Canada what South Korea can offer. “The team at Hanwha have demonstrated to the Canadian public and government that there is unlimited potential to unlock within the South Korean defense industrial base and that Hanwha and its business divisions will continue to grow aside from today’s decision,” Copeland said in a statement. “We look forward to continuing to demonstrate why Hanwha is the backbone of the world’s fourth-largest defense export nation.”

Hanwha mounted a significant economic and public relations push to convince Canada about the value of its boats. That included the Republic of Korea Navy sending one of its KSS-III submarines to Victoria, British Columbia, in May to show the long-range capabilities of the boat as well as to conduct joint operations with the Royal Canadian Navy.

The South Koreans were also promoting the procurement as a way for Canada to expand its relations in the Asia-Pacific region. Carney said that the loss for Hanwha does not signal a change in Canada’s commitment to the area. “We’re very committed to the Indo-Pacific strategy,” he said. “There are a series of other initiatives Canada and Korea are pursuing that build our economic resilience and security footprint.”

Stephen Fuhr, secretary of state for defense procurement, said at a news conference in Victoria on July 6 that the submarine competition was completed in record time. The whole process took less than a year.

Fuhr said one of the main criticisms of Canada’s defense procurement process is that it is too lengthy. But he noted he intends to change that and speed up other future defense procurements.

The current fleet of Victoria-class submarines operated by the Royal Canadian Navy will be decommissioned in the mid-2030s, the Canadian government has noted.