As the US Rethinks AUKUS, Australia and the UK Forge Ahead
Amid the Trump administration's ongoing review of the AUKUS trilateral security pact, Canberra paid Washington $800 million as the second 2025 installment for submarine capability and capacity development. Australian and British regulators also met in England to update their Memorandum of Cooperation for enhanced information sharing on the nuclear submarine sector. A 50-year bilateral Nuclear-Powered Submarine Partnership and Collaboration Agreement was signed in the same week during the 15th AUKMIN held in Geelong, Australia.
Australian Trade Minister Don Farrell brushed off the idea that the bilateral treaty would cause annoyance in Washington. 'The message that the Americans will get out of this is that the other two parties to AUKUS are very, very supportive of the continuation of the project,' he argued. Commencement of the Geelong Treaty negotiations was announced at the trilateral AUKUS defense ministerial meeting in September 2024.
While focusing on the establishment of strategic and operational frameworks for the delivery of AUKUS' nuclear-powered submarines (SSNs), the treaty signifies London and Canberra's extended commitment to strengthening the resilience of submarine industrial bases across the two nations well beyond the AUKUS timeline, which looks to have eight SSN submarines built in Australia by the 2060s.
The treaty also strikes a chord with the U.K.'s Strategic Defense Review published in June, announcing the enhancement of British submarine production with up to 12 SSNs by producing a submarine every 18 months. The renewed defense vision by the British government pays particular attention to Pillar 2 of AUKUS against the backdrop of 'a new era of threat,' underscoring the need to forge closer industrial and technological partnerships with the US for defense capability upgrades.
Pillar 1 of AUKUS focuses on developing shipbuilding capacities of the three nations, which includes Australia's acquisition of its first SSNs. Pillar 2 focuses on joint development of eight advanced military capability areas such as autonomy, artificial intelligence (AI), electromagnetic warfare, modelling, and simulation.
The United States' Reassessment
While Australia and the U.K. push forward, the Pentagon is undertaking a review of the deal. One of the questions under scrutiny is whether the U.S. industrial base can support U.S. naval strategy in today's complex security environment. The current production rate of Virginia-class submarines stands at 1.13 per year – far from the rate of two per year necessary for fulfilling its own defense priorities and the 2.33/year rate necessary to deliver on its AUKUS promises. Under those circumstances, the U.S. commander-in-chief would not be able to sign off on relinquishing SSNs to Australia as scheduled per the AUKUS mandate.
To make good on its AUKUS obligations, the U.S. shipbuilding industry is 'going to require a transformational improvement' with a '100 percent' boost in delivery pace, Adm. Daryl Caudle said on July 24, in a Senate hearing to consider his nomination as the next chief of naval operations. He particularly pointed out existing deficiencies of the U.S. Navy's undersea capability.
Caudle told the U.S. Senate that 'the delivery pace is not where it needs to be to make good on the Pillar 1 of the AUKUS agreement, which is currently under review by our Defense Department.'
Another sticking point for Washington is the commitment to collective defense among U.S. allies in light of the growing flashpoints across the Indo-Pacific. The Pentagon review is being led by U.S. Under Secretary of Defense for Policy Elbridge Colby, an AUKUS skeptic who has pressed Australia on how it would act in a hypothetical China-U.S. conflict over Taiwan.
Using his account on X, Colby also urged allies to step up defense spending, doubling down on the Trump administration's earlier call for Australia to raise defense spending to 3.5 percent of its GDP from 2.33 percent by 2033. However, Australian Prime Minister Anthony Albanese and his Cabinet continue to refrain from making further military and financial commitments.
Prior to joining the Trump administration, Colby cast doubts over the United States' AUKUS deliverables during a January 2024 interview with the Australian Broadcasting Corporation. 'It would be crazy for the United States to give away its single most important asset for a conflict with China over Taiwan when it doesn't have enough already,' he said at the time. 'Money is not the only issue – it's also time, limits on our workforce, etc., so both sides of this vitally important alliance need to look reality in the face.'
Despite the new Australia-U.K. treaty and memorandum, Australia's timely down payment, and Pillar 2 partnership envisagement, these reassuring moves did not allay the concerns that have Colby and the Pentagon rethinking AUKUS.
China's Reactions
Although there was no public mention of AUKUS being on the agenda in the meeting between Australian Prime Minister Anthony Albanese and China's President Xi Jinping in July, China is seen making more subtle moves to counter the trilateral defense partnership in the region.
While Albanese was in Chengdu as part of his second official visit to China as prime minister, China's Consul General in Sydney Wang Yu caught Newcastle Mayor Ross Kerridge by surprise on July 17, with a question on potential docking locations for AUKUS submarines. Australian federal government officials and senators have voiced concerns regarding national security being brought to city-level closed-door meet-and-greets.
On the sidelines of the 58th Association of Southeast Asian Nations (ASEAN) Foreign Ministers' Meeting in July, China shared its intention to accede to ASEAN's Protocol to the Southeast Asian Nuclear Weapon-Free Zone Treaty. The treaty commits state parties not to develop, acquire, and station nuclear weapons. China emphasized in its announcement that the region is 'not an arena for major power rivalry.'
The 10 ASEAN nations have been calling on the five nuclear weapon states – including both the U.S. and the U.K. – to ratify the treaty since 1997, and China expressed support as early as 1999. However, Beijing's latest confirmation that it will sign the treaty, after more than two decades of intent, could not only reinforce China's good neighborhood image without additional tangible commitments but also add to its toolbelt for discrediting nuclear-powered military partnerships in the region.
A French (Re)involvement?
As the Pentagon's AUKUS review prolongs, recent activities suggest France might be a keen onlooker of the development.
Under the Lancaster House 2.0 and Northwood Declaration unveiled during French President Emmanuel Macron's recent state visit to the United Kingdom in July, nuclear coordination and cooperation were deepened between the two European nuclear powers. Their enhanced nuclear research, intelligence exchange, and overall defense capability could indirectly complement Pillar 2 of AUKUS – even without France joining.
Additionally, France and the U.K. also agreed to strengthen maritime coordination in the Indo-Pacific through joint security training, reciprocal base access, and the launch of a new Global Maritime Security Dialogue. The renewed interest by the French government recognizes its shared responsibility in the region, given that more than 90 percent of France's Exclusive Economic Zone is in the Indo-Pacific.
Subsequently, the French government revamped its Indo-Pacific strategy as a priority in July with an emphasis on strategic autonomy and sovereignty partnerships. Most prominently, Australia is now back on the list of 'priority strategic partners' after being taken out from France's 2022 strategy after AUKUS was formed. The new SSN partnership left France blindsided, as it also brought the cancellation of an Australia-France contract for diesel-electric submarines.
Rebuilding Australia-France ties from that 'unprecedented new low' has been prioritized by the Albanese administration from the beginning. A $585 million settlement to the French Naval Group was agreed to less than a month after Albanese took office in July 2022, and a three-pillar roadmap was laid out soon after for their New Agenda for Bilateral Cooperation.
French Ambassador Pierre-André Imbert did not rule out a future submarine deal with Australia as the French armed Forces joined the 19-nation military drill in Australian waters and Papua New Guinea in July. Australia has 'chosen AUKUS… If that changes – if they ask, we will see,' he said. 'The first pillar of our Cooperation is Defense and Security, so we have a very good level of cooperation.'
Speculation and public anxiety continue to sprout with the Pentagon review expected to be concluded in the fall. In the meantime, calls for an Australian inquiry into the nation's largest-ever defense project are simmering. With high-profile figures like former Prime Minister Malcolm Turnbull expressing opposition to the deal.
The path for Australia to acquire nuclear-powered submarines is likely to remain rocky, with the question at hand not being whether AUKUS should continue, but how. Calls for contingencies and deliverable assurances are rising as the pact comes under scrutiny.
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