The AUKUS submarine agreement between the US, UK, and Australia is facing new doubts as President Donald Trump’s tariffs take effect, and concerns in Washington about whether transferring nuclear-powered submarines to Canberra could weaken US deterrence against China are growing.

Australian Defense Minister Richard Marles recently said that Australia’s plan to buy three Virginia-class submarines starting in 2032 depends on whether the US can increase submarine production to meet both its own needs and AUKUS commitments.

Marles also revealed that Australia must pay $2 billion to the US by 2025 to help expand American submarine shipyards, an obligation not previously reported. The Trump administration has since asked for even more funding.

US defense experts also worry that Australia has not made clear whether it would use the submarines in a potential conflict with China, raising fears that transferring them out of the US Navy could hurt deterrence in the Indo-Pacific region.

"If you want to deter conflict, in peacetime you need to talk about using it in wartime, and we haven’t seen a willingness yet on the part of the Australians, government or officials, to make that kind of threat," said Bryan Clark, a former US Navy strategist who advises the Australian Defense Force.

Airpower less risky

Clark said that during a recent war game simulating a Chinese blockade of Taiwan, Australian commanders avoided using nuclear submarines in the South China Sea. Instead, they focused on defending northern Australia with airpower, drones, and missiles, an approach seen as less risky due to the distance from China.

A February report by the US Congressional Budget Office and testimony in March also raised concerns, warning that transferring submarines to Australia without replacements could be risky, especially since Canberra hasn’t committed to joining the US in a conflict over Taiwan.

This issue is more urgent as the US Navy has set a 2027 deadline to be ready for a possible conflict with China.

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Peter Dean, a defense expert at the United States Studies Centre in Sydney, said the US and Australia would likely use their submarines in different areas during any regional conflict. “Australia may not be directly involved,” he said, explaining that Australia’s priority is protecting its mainland and acting as a forward base for US forces.

Clark also pointed out that workforce shortages and budget limits in Australia could delay the submarine deal, suggesting that US and UK submarines operating out of Perth with dual crews, supported by Australian facilities, could still serve as a strong deterrent.

The Australian Submarine Agency said acquiring nuclear submarines is a key part of its defense strategy. The submarines would be used for intelligence, surveillance, and undersea warfare.

The Pentagon confirmed its commitment to the plan, including the sale of Virginia submarines to Australia. A US National Security Council spokesperson added that the US continues to work closely with Australia and the UK on implementing AUKUS.

However, Trump’s tariffs have frustrated many in Australia, where the public expected that closer defense ties would lead to trade benefits. With a national election on May 3, there are fears that independent lawmakers, many of whom are critical of Trump and the submarine deal, could gain influence if no party wins a majority.

Under AUKUS, four US-operated Virginia-class submarines and one British submarine will rotate through HMAS Stirling in Western Australia starting in 2027. Australia would begin commanding its own Virginia subs in 2032, with a new joint AUKUS submarine class expected by 2040.

Dean warned that relying solely on US-operated submarines until 2040 would be too risky for Australia. “Outsourcing our defense to another country to a level that is not acceptable,” he said.

On Australian-Chinese sensitivities 

Former Prime Minister Scott Morrison, who signed the AUKUS agreement in 2021, said the deal was meant to deter China. “China is the threat—of course they are—and that is what needs to be deterred,” Morrison said. “The idea of more US and British boats being based in and around Australia was always part of the plan.”

On the other hand, current Prime Minister Anthony Albanese has taken a less aggressive public stance toward China, although Australian patrols in the South China Sea continue. His softer tone has been a political target for opposition leader Peter Dutton, who was defense minister in Morrison’s government.

“The Chinese made a big effort for us not to proceed with AUKUS precisely because they saw the deterrence effect,” said Arthur Sinodinos, Australia’s former ambassador to Washington. “There is a deterrent, whether the stuff is in the US column or the Australian column.”

Australian ships sailed across the Taiwan Strait for the first time in 7 years on 25 September 2024, after Germany sailed its warships across the strait for the first time in 22 years.

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