Abandoned Sovereignty: How Canada Gave Up on Its Own Defence Industry

I began writing this piece over a year ago, and now it seems time to publish. I have seen first hand, during my time working for the UK feds, the way most members of NATO, not just Canada, have purchased U.S. military equipment, often under political pressure, and to the detriment of their own defence industries.  NATO interoperability standards should mean that any compatible equipment should be a viable option, considered through open competitive bidding, yet the geopolitical reality is something completely different. 

Canada has long faced intense pressure—political, economic, and social—to purchase U.S. military equipment for its armed forces, a reality that has shaped its defense procurement decisions for decades. This pressure is deeply rooted in history, from Cold War-era alliances to modern-day trade dependencies, and it has left Canada with little choice, but to align its military acquisitions with American interests. The consequences of this alignment go beyond procurement choices; they have also played a role in the erosion of Canada’s own defense research and development capabilities.

The political pressure to buy American is most evident in Canada’s commitment to joint defense initiatives, particularly NORAD and NATO. From the early days of the Cold War, Canada’s defense policies have been deeply entwined with those of the United States. The integration of North American air defense under NORAD meant that Canada’s fighter aircraft, radar systems, and missile defense strategies had to be compatible with those of the U.S. When Canada scrapped its own Avro Arrow fighter program in 1959, ostensibly for cost reasons, it conveniently cleared the way for the adoption of American aircraft like the CF-101 Voodoo, locking the Royal Canadian Air Force (RCAF) into a reliance on U.S. technology that continues to this day.

This trend persisted throughout the latter half of the 20th century. Canada’s navy, which once built world-class destroyers and anti-submarine vessels, saw its shipbuilding industry decline, and by the 1990s, the country was purchasing used British submarines while remaining dependent on American-built weapons and sensors. Similarly, Canada’s decision to buy the CF-18 Hornet fighter in the 1980s followed a pattern of choosing U.S. aircraft over European or domestic alternatives. While the CF-18 has served well, it locked Canada into the U.S. military supply chain for parts, upgrades, and replacements. Now, with the planned acquisition of F-35 stealth fighters, that dependence is only deepening.

Economically, Canada’s military procurement is heavily influenced by its integration with the U.S. defense industrial base. The Defense Production Sharing Agreement (DPSA), signed in 1956, allowed Canadian defense firms to bid on U.S. military contracts, but it also cemented Canada’s role as a supplier of components rather than a leader in weapons development. This effectively sidelined Canadian military research and engineering projects, making it far more difficult to revive independent initiatives. When the Arrow was canceled, it wasn’t just a single aircraft project that was lost—it was an entire aerospace industry that could have positioned Canada as a technological leader rather than a perpetual customer of American defense contractors.

The economic argument for buying American is always framed in terms of cost-effectiveness and interoperability, but the reality is that it often comes with trade-offs. The purchase of American equipment frequently involves hidden costs—maintenance contracts, dependency on U.S. technology, and restrictions on modifications. The recent push to buy American-made submarines, replacing the troubled British-built Victoria-class boats, is another example of how Canada’s choices are limited by its reliance on U.S. and NATO systems. In many cases, American weapons systems are the only viable option simply because Canada has not maintained the capability to produce its own alternatives.

Public sentiment in Canada is often skeptical of major military purchases, and this can create social and political tensions. Many Canadians are uncomfortable with high military spending, particularly when it benefits American defense giants like Lockheed Martin or Boeing. This unease has been reinforced by past procurement scandals, such as the costly and controversial EH-101 helicopter cancellation in the 1990s, which resulted in years of delays in replacing Canada’s aging Sea Kings. Yet, despite public resistance, successive Canadian governments—Liberal and Conservative alike—have found it almost impossible to escape the gravitational pull of American defense procurement.

Interoperability with U.S. forces is the most frequently cited justification for this dependence, and in some cases, it is a valid one. Canadian troops often train and deploy alongside U.S. forces, making shared equipment a practical necessity. However, this argument is often overstated to justify buying American even when other options exist. The recent decision to acquire P-8 Poseidon maritime patrol aircraft from Boeing, rather than exploring alternatives like the Airbus C295 or continuing to develop Canadian-built options, reflects this bias. The same was true with the decision to buy Sikorsky CH-148 Cyclone helicopters, a troubled program that has suffered significant delays and technical issues.

Over time, Canada’s ability to independently design and produce advanced military hardware has been systematically dismantled. The cancellation of the Arrow was just the first in a series of decisions that saw Canadian innovation sacrificed in favor of American procurement. The loss of the CF-105 program, the shelving of independent drone development efforts, and the abandonment of domestic tank production have left Canada as a nation that buys rather than builds. While there are still areas of strength—such as armored vehicle production through General Dynamics Land Systems Canada—the overall trajectory has been one of increasing dependence on the U.S.

The reality is that Canada’s defense procurement strategy is shaped as much by geopolitics as by practical military needs. The U.S. is both Canada’s closest ally, and its largest trading partner, and any significant deviation from American military procurement norms risks diplomatic and economic fallout. The fear of upsetting Washington is a powerful deterrent against seeking alternatives, whether from European manufacturers or through domestic production.

In the end, Canada’s military procurement is not just a matter of choosing the best equipment—it is a strategic and political decision that reflects the country’s place in the global order. Until Canada makes a concerted effort to rebuild its defense research and production capabilities, it will remain at the mercy of U.S. military priorities. Whether that is an acceptable trade-off is a question that Canadian policymakers—and the public—must continue to grapple with.

Update
Since writing the core of this piece, there has been some signs that Canada is trying to rekindle its own defence industry with its ship building program for the new River class destroyers, the conversation about purchasing European designed and built submarines, and early discussions regarding reducing the F-35 purchase program, in favour of the Swedish Saab Gripen. The Swedish proposal, which promised that aircraft assembly would take place in Canada, and that there would be a transfer of intellectual property, which would allow the aircraft to be maintained in this country, was very different from the U.S. F-35 program, where major maintenance, overhaul and software upgrades would happen in the States. The second Trump administration might just be the catalyst that Canada needs to seek alternative solutions rather than the business as usual approach we have seen over the last 75 years.  

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