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For more than a decade, Australia’s submarine debate has been shaped by one uncomfortable reality: the country cannot afford to let the undersea arm atrophy while waiting for a future fleet that may arrive later than planned.
The story is by now familiar. Collins was designed to carry Australia through a transitory strategic period post-Cold War, the Attack Class was meant to replace it, the 2021 cancellation of that program created a new hole, and AUKUS Pillar 1 then became the national bet on a nuclear-powered future.
Under the March 2023 “optimal pathway”, Canberra committed to Collins life-of-type extension (LOTE), US Virginia Class transfers in the early 2030s, and an Australian/UK-built SSN-AUKUS later in the 2040s.
That same transition is now being complicated by a scaled-back Collins LOTE, a rapidly advancing Ghost Shark program, and a renewed argument over whether Australia needs a genuine bridge or simply stronger faith in the plan it already has.
Successive government’s line has been that there is no capability gap if the plan is executed well enough. But the most serious outside analysis says the risk is real, and potentially sudden.
The Australian Strategic Policy Institute’s (ASPI) latest report by Richard Gray and Mike Hughes and subsequent analysis, titled Hedging our bets: a Japanese option for managing risk in the AUKUS Optimal Pathway on a Japanese option, said the “potential capability gap” “could emerge suddenly” and that it is “probably too long a period for Australia to run the risk of being without an essential capability”.
The same report also warned that if enough Virginias do not arrive, Canberra may be forced to choose between enduring a “critical capability gap” or rapidly finding a viable workaround, with Gray and Hughes saying, “While AUKUS remains the best mechanism for ensuring partner nations’ future defence, all three governments acknowledge that there are substantial risks already identified in the AUKUS Optimal Pathway.
“Nuclear-powered submarines under government control will give Australia a critical defensive capability while helping all three AUKUS nations deter China. AUKUS naysayers who argue the partnership should be terminated, including on the basis that it reduces Australian sovereignty, rarely provide any realistic alternative. But risks do exist. The challenge is to neither get swept up by concerns around US or British reliability nor sweep known risks under the rug.”
That is the framing that matters now, not whether AUKUS is desirable in the abstract, but what Australia does if the bridge between Collins and Virginia proves thinner than advertised.
The pair added: “To avoid losing a modern, crewed, sovereign submarine capability in the 2030s, Australia needs to start considering ways to mitigate those risks. One option is the leasing of submarines, and cooperation with Japan offers a realistic path forward. As the requirement for these submarines could emerge rapidly, if this is to be a viable option, Australia needs to start pursuing it now.”
Collins LOTE – the least risk (at least on paper)
The first and most obvious bridging strategy is straightforward: keep Collins operational for as long as possible.
In May 2026, the government confirmed that the Collins LOTE would commence with HMAS Farncomb while shifting towards a “conditions-based sustainment approach” intended to reduce risk, improve availability and retain capability.
Indeed, in their joint media release, Deputy Prime Minister and Defence Minister Richard Marles and Defence Industry Minister Pat Conroy stressed the importance of this approach, stating: “This will reduce engineering and schedule risks and ensure the Collins Class remains a formidable deterrent for years to come.”
“As one of the oldest boats in the Collins Class fleet with the highest number of sea days and distance travelled, HMAS Farncomb’s life-of-type extension will also include a detailed engineering assessment period to tailor its life-of-type extension upgrades and inform work required across the class,” the media release stated.
The government also committed up to $11 billion across the next decade for sustainment, maintenance, workforce and infrastructure associated with Collins.
This remains the baseline solution because it preserves several critical advantages simultaneously:
- A sovereign Australian-crewed submarine force.
- Existing operational doctrine and expertise.
- Sustainment workforce continuity.
- Industrial continuity at ASC.
- A deterrent capability that already exists.
Importantly, Collins is not an unknown quantity. The boats have long suffered from availability and sustainment challenges, but Navy understands them, industry understands them, and crews know how to fight them.
That matters.
A complex, ageing platform with established support structures is still less risky than introducing an entirely new class during a period of workforce shortages and industrial strain.
But there are limits to what Collins can realistically deliver. The government’s revised LOTE approach effectively acknowledges this. Rather than a comprehensive rebuild, Defence is increasingly focused on selectively replacing systems and managing platform condition to maximise availability while avoiding excessive complexity.
In practice, this is a recognition that Collins is being pushed further than originally intended. The challenge is not simply hull life. It is maintenance tempo, workforce depth, supply chain resilience and platform availability.
Australia can probably keep Collins operational long enough to bridge much of the gap, but probably is not the same as certainly, and in submarine capability planning, uncertainty is dangerous.
A Japanese stopgap?
If Collins alone cannot comfortably bridge the gap, then the next question becomes whether Australia should pursue a temporary off-the-shelf submarine capability.
This is where the Japanese option has re-entered serious strategic discussion.
Gray and Hughes argued for “leasing or otherwise rapidly acquiring small numbers of an advanced conventional submarine capability from Japan”, highlighting Japan’s large and comparatively young submarine fleet alongside its active production capacity.
They went further, adding: "Leasing a modern submarine capability to fill an emerging gap would present far fewer challenges. Leasing or otherwise rapidly acquiring Japanese submarines would require few resources, at least initially, and wouldn’t detract from the Optimal Pathway until that path became obviously unachievable or significantly delayed.
"As we get closer to key decision points – such as certification to US Congress by the next US administration, likely in 2030 or 2031 – the level of effort required to make leasing a small number of Japanese submarines a reality could be dialled up or down according to the assessed level of risk at the time.”
The logic is compelling.
Japan already operates highly advanced conventional submarines optimised for Indo-Pacific operations. The boats are mature, in production, regionally relevant and backed by an industrial base that is already functioning.
Most importantly, leasing could theoretically provide speed. That matters because a traditional acquisition program may simply arrive too late to solve the problem it was intended to fix.
A conventional stopgap only makes sense if it arrives before the capability gap fully emerges. If Australia spends a decade establishing another bespoke submarine class, then the bridge effectively becomes another permanent fleet.
That is precisely the trap Canberra has spent years trying to escape.
ASPI itself acknowledged this tension, noting that a new conventional submarine fleet may not represent value for money if the capability arrives too close to SSN-AUKUS entering service.
Gray and Hughes stated that “it would still present obstacles, leasing a modern submarine capability to fill an emerging gap would present far fewer challenges. Leasing or otherwise rapidly acquiring Japanese submarines would require few resources, at least initially, and wouldn’t detract from the Optimal Pathway until that path became obviously unachievable or significantly delayed.”
The attraction of a Japanese lease or rapid acquisition is therefore not that it replaces AUKUS. It is that it insures against delay.
The French connection or a US alternative?
The Japanese option is not the only alternative being discussed.
Former submariner and strategic analyst Peter Briggs has argued Australia should simplify the pathway entirely and adopt a single mature submarine design instead of operating a mix of Collins, Virginia and SSN-AUKUS.
In a parliamentary submission, Briggs argued: “The submarine chosen should be based on a mature design, in production.”
He identified two particularly credible options:
- A Virginia derivative.
- The French Suffren Class submarine.
Now while the argument has merit – a mature design reduces technical risk, avoids excessive customisation and leverages existing production ecosystems – there is a major catch.
Neither option is actually fast. A Virginia derivative would still rely heavily on US industrial capacity, the very industrial base already under pressure delivering submarines for the US Navy itself.
Meanwhile, a French-derived solution would require Australia to establish or perhaps re-establish new training pipelines, industrial partnerships, sustainment arrangements and operational integration frameworks.
In other words, mature does not automatically mean rapid and, critically, timing is everything.
The longer Canberra waits to establish a contingency option, the more likely any stopgap becomes a major acquisition project in its own right.
That would risk recreating many of the problems that undermined the Attack Class program in the first place.
The uncrewed solution?
Alongside conventional options sits the most disruptive possibility of all: using autonomous systems to partially offset a temporary decline in crewed submarine numbers.
This is where Anduril’s Ghost Shark Extra Large Autonomous Underwater Vehicle (XL-AUV) enters the discussion. Developed under the Advanced Strategic Capabilities Accelerator (ASCA), Ghost Shark is designed as a large autonomous undersea vehicle capable of long-range operations, intelligence collection and potentially strike-related missions.
ASCA describes the capability as providing “a long-range autonomous undersea capability” that will “complement Defence’s existing crewed force”.
That wording is important, complement, not replace. Nevertheless, Ghost Shark offers several major advantages:
- Lower operating costs.
- Reduced personnel burden.
- Greater mass and persistence.
- Higher operational ambiguity.
- Lower political risk in contested areas.
- Faster production scalability.
Strategically, autonomous systems can complicate an adversary’s planning significantly.
A distributed network of uncrewed undersea systems operating across Australia’s northern approaches would force any adversary to dedicate resources towards detection, tracking and neutralisation.
That creates friction, and friction matters, but Ghost Shark is not a substitute for a sovereign crewed submarine force.
At least not yet.
An XL-AUV cannot currently replicate the full range of missions performed by a crewed SSN, particularly long-endurance deterrence patrols, complex intelligence operations, escort functions or sustained independent strike operations.
That is why even the government’s own strategic framing for AUKUS continues to revolve around sovereign nuclear-powered submarines rather than autonomous systems alone. Ghost Shark may become a critical force multiplier. But it is still only a multiplier, not the core capability itself.
Worst case scenario – no submarine capability
The final possibility is the one Canberra least wants to discuss publicly.
What if Australia simply experiences a submarine capability gap? Not a reduced capability, a genuine gap.
If Collins availability declines faster than expected and Virginia transfers are delayed or reduced, Australia could theoretically face periods where submarine availability becomes strategically inadequate.
ASPI’s warning about a “critical capability gap” was not rhetorical flourish, the consequences would be severe.
Submarines remain Australia’s most survivable strategic strike and intelligence platform. They underpin maritime denial strategy, intelligence collection, deterrence and long-range sea control in ways that surface combatants and aircraft simply cannot fully replicate.
Gray and Hughes reinforced this, saying, “A sovereign submarine capability is a core requirement for Australia’s defence over the next two decades. Given there are known risks that could prevent that happening, exploring a relatively modest alternative seems prudent. To ensure this alternative is available when we need it to be, Australia should start pursuing it now. There is no better time than Takaichi’s visit to Australia.”
Without submarines, Australia would become substantially more reliant on allied undersea capabilities. That would weaken sovereign deterrence precisely when Canberra is attempting to strengthen it.
It would also create broader operational consequences across the Australian Defence Force.
The Royal Australian Navy’s surface fleet becomes more exposed without submarine screening and intelligence support. Long-range maritime strike becomes more dependent on air power. Intelligence collection becomes more constrained.
Most importantly, Australia loses one of the few capabilities capable of imposing genuine uncertainty on a larger adversary, that is not simply a military problem. It is a strategic one.
Final thoughts
So what is the most viable option? Not a single silver bullet.
The most credible answer is a layered approach combining several imperfect but complementary solutions.
First, Collins must be sustained as aggressively as possible. Regardless of its age, it remains Australia’s only sovereign submarine capability currently in service.
Second, Ghost Shark and related autonomous systems should be accelerated wherever feasible. Autonomous undersea capabilities offer Australia an opportunity to expand mass and persistence at comparatively lower cost and lower workforce burden.
Third, Canberra should quietly establish a genuine contingency plan for a crewed stopgap capability, most plausibly involving Japan.
Not because Australia should abandon AUKUS, but because contingency planning is what serious middle powers do.
The uncomfortable reality underpinning this entire debate is that Australia is not choosing between perfection and compromise, it is choosing between managed compromise and unmanaged risk.
AUKUS remains the strongest long-term pathway towards a sovereign nuclear-powered submarine capability, but the pathway only works if its timelines hold.
Put more simply, the Collins LOTE program buys us time, Ghost Shark buys us options, and a foreign stopgap buys us much-needed insurance.
Conversely, no submarine capability buys neither deterrence nor confidence, and that is the strategic reality Canberra now has to confront.
Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below or get in touch at
Stephen Kuper
Steve has an extensive career across government, defence industry and advocacy, having previously worked for cabinet ministers at both Federal and State levels.
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