Hyundai offers hydrogen plan to boost Canada submarine bid

Hyundai Motor Group has proposed establishing hydrogen fuel-cell infrastructure across Canada as part of South Korea’s effort to secure a multibillion-dollar contract to build a new class of submarines for the Royal Canadian Navy, executives involved in the bid have said. The move, designed to appeal to Ottawa’s focus on broader industrial benefits beyond defence capabilities, envisages hydrogen production and refuelling corridors that could serve heavy-duty transport and rail networks and potentially distinguish the Korean bid from rival offers.

Senior officials from Hyundai’s partner in the bid, Hanwha Ocean’s Canadian subsidiary, outlined the hydrogen proposal during discussions with Canadian government representatives and visiting delegations. Glenn Copeland, president of Hanwha Ocean Canada, described the plan as “a substantial investment” that could transform key transportation corridors but stressed that details have yet to be finalised as negotiations continue.

Canada’s procurement of a fleet of up to 12 new patrol submarines, a programme valued at an estimated 60 trillion won, has become a focal point for industrial diplomacy in Ottawa as it weighs strategic partnerships tied to defence and wider economic investment. The Korean bid, submitted by a consortium of Hanwha Ocean and HD Hyundai Heavy Industries, is competing against Germany’s ThyssenKrupp Marine Systems in the final evaluation stage, with a decision expected to be announced later this year.

Analysts say the hydrogen infrastructure offer responds to Canada’s emphasis on “industrial and technological benefits”, a key criterion in the tender that requires bidders to demonstrate how they will deliver broader economic value to Canadian industry. By linking a defence contract to potential growth in clean-energy infrastructure, Hyundai and its partners are aligning with Ottawa’s dual objectives of modernising the navy and accelerating energy transition initiatives.

Hyundai Motor Group has been expanding its presence in the hydrogen sector under its HTWO brand, spanning hydrogen production, storage, mobility and applications across sectors. The company’s broader strategy involves positioning itself as a leader in the hydrogen economy, leveraging fuel-cell technology as a core future growth driver and using large government-linked projects as springboards for scaled deployment.

Market response to the hydrogen infrastructure proposal was notable, with shares of Hyundai Motor and affiliated companies gaining ground on optimism that the strategy could enhance the group’s competitive edge and valuation prospects. The stock movements reflected investor confidence in the synergy between defence opportunities and clean-tech development, an area that South Korean conglomerates have increasingly prioritised.

Copeland, a former Royal Canadian Navy officer recruited to lead Hanwha Ocean Canada’s bid efforts, emphasised that the hydrogen plan is intended to be collaborative and scalable, with initial concepts focusing on three to four “network corridors” that could link hydrogen facilities supporting freight trucking and rail operations in regions with demand for low-carbon energy alternatives. Should discussions with Ottawa progress, the initiative could lay the groundwork for expanded hydrogen infrastructure across the country.

Canadian officials have underlined that investment, jobs and longer-term industrial cooperation are pivotal in the evaluation of bids. Ottawa has been clear that proposals must extend benefits beyond the defence sphere, signalling that transformational economic opportunities will weigh heavily in its assessment of each contender. The hydrogen proposal appears designed to meet that threshold while offering a blueprint for potential bilateral cooperation in energy and transport sectors.

German competitor ThyssenKrupp Marine Systems has sought to counter with its own package of offsets and industrial cooperation commitments, highlighting investments in battery manufacturing and automotive industry engagement. Germany’s approach has been framed as complementary to Canada’s broader economic priorities, intensifying competition between bidders on the basis of long-term industrial impact as well as defence performance.

Ottawa’s final decision will hinge on a complex mix of technical assessment, delivery schedules, cost considerations and the perceived value of industrial benefits to the Canadian economy. Both bidders have been pressed by Ottawa to clarify how their proposals will translate into tangible economic activity, job creation and technology transfer, particularly in sectors that dovetail with Canada’s national priorities.