At the top of the naval tree sit the countries able to design, build, and operate nuclear-powered attack submarines (SSN), capabilities so advanced as to render virtually all other forms of naval vessel as a friendly sensor node if ally, or prospective target if enemy.
Further still, at the most extreme end, are the nuclear-powered ballistic missile submarines (SSBN), whose job it is to patrol silent loops in deep oceans, containing weapons so final that their use is all-but unthinkable.
These SSN and SSBN are immense programmes, utilising cutting-edge technologies and the very latest manufacturing techniques to provide platforms of strategic effect. However, they are also among the costliest defence procurement efforts to undertake, with spending running into the tens of billions of dollars, spanning not just years, but decades.
According to GlobalData’s Global Submarine Market Forecast 2024-2034 report, the global submarine market, valued at $37.3bn in 2024, was projected to grow at a compound annual growth rate (CAGR) of 4.4% over the forecast period.
The market was expected to reach $57.5bn by 2034 and cumulatively value $504.6bn over the forecast period. Of this, the SSN segment was forecast to account for 48.9% of the market, followed by the SSBN segment with 30.7% share.
Put another way, 79.6% of spending on submarine programmes is heading to the development of SSN and SSBNs.
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By GlobalDataAmong geographic segments, North America is projected to dominate the sector with a share of 44.1%, followed by Asia-Pacific and Europe with shares of 29.4% and 22.3% respectively.
Breaking down spending by country, and five emerge as the projected leaders in spending on nuclear-powered submarines over the next decade, all of which are wholly or partially located in the Indo-Pacific regions.
Australia
A newcomer to the naval nuclear submarine sector, Australia has embarked on a twin-pronged plan to develop an SSN capability for the Royal Australian Navy (RAN) through the AUKUS security initiative, with huge assistance from the US and the UK.
Pillar 1 of the AUKUS framework culminates with the sale of Virginia-class submarines from the US to Australia in the early 2030s, with the RAN operating up to three Virginia-class SSNs, which are likely to be in service for at least 10 years, and a further two Virginia class being held on option.
Australia will then replace the Virginia-class submarines with the SSN-AUKUS design, a joint programme with the UK that will deliver a next-generation SSN to replace the Astute and Virginia classes in service. The UK will deliver its own first SSN-AUKUS in the late 2030s, with the first SSN-AUKUS built in Australia delivered forecast for the early 2040s.
A key line in the March 2024 statement from the AUKUS countries revealed that the SSN-AUKUS was being “trilaterally” developed, based on the UK SSNR Astute-replacement design, but will incorporate “technology from all three nations”, including “cutting edge United States submarine technologies”.
It is not clear what “cutting edge US technologies” are referred to, although it could include strike elements such as the vertical launch system (VLS) based on the Virginia Payload Module developed for the US Navy’s Virginia-class SSNs to provide the type with additional firepower.
In addition, it is possible that a common torpedo could be utilised by the US, UK, and Australia, with US and UK submarine currently operating the Mk48 and Spearfish heavyweight torpedo respectively.
Other areas of commonality that could be derived from US technology include common and control systems, sonar, and other intelligence gathering sensors.
GlobalData analysis shows that Australian spending on AUKUS, which has already seen multi-billion-dollar investment into the UK and US defence industries, will rise from nearly $3.6bn in 2024 to just short of $6.4bn by 2034. All told, Canberra will commit $52.8bn in SSN acquisition over the coming decade.
China
China’s defence spending is reshaping global security with Beijing set on creating a multi-polar world order, balancing the previous domination of the United States over the last generation. According to analysis, the PLAN has the largest navy in the world.
The country’s defence expenditure saw a CAGR of 7.5% during 2019–23, standing at $230.3bn in 2023, and was forecast to register a CAGR of 6.6% to value $323.7bn in 2028. The Chinese Department of National Defence is also expected to spend $1.4trn over 2024–28 on the procurement of military hardware and the modernisation of its armed forces.
Of this, more than $36.6bn will be dedicated to SSN and SSBN acquisition, with an annual spend in 2034 forecast to more than $4.3bn, from $2.6bn in 2024.
China’s People’s Liberation Army Navy (PLAN) was a prolific operator of diesel electric submarines, but since the turn of the Millenium has sought to further develop its nuclear propulsion capabilities, with the introduction of two Type-093 SSNs between 2006-2007 and four Type-093A variants from 2012-2017.
The PLAN also operates SSBNs, bringing four Type-094 into service between 2007-2021 and two Type-094A in 2020. The PLAN also has a single 1980s-era Type-092 SSBN in its inventory.
China is also working on the new Type-096 class of SSBNs, with two boats under construction, with many more likely planned as part of a general shift to nuclear propulsion for its subsurface fleet. In addition, an unknown number of boats under the Type-095 SSN design are also in development, with Bohai Shipyard (China Shipbuilding Industry Co Ltd) the most likely candidate for the manufacturing stage.
India
In late-2024, in a significant move towards bolstering maritime security, India’s Cabinet Committee on Security (CCS) approved the indigenous construction of two Project 75-Alpha nuclear attack submarines (SSNs), itself part of a much wider spending pattern on subsurface capabilities.
The procurement of indigenous nuclear-powered submarines capable of undertaking hunter-killer operations positions the Indian Navy as a formidable force capable of conducting anti-submarine warfare in the Indian Ocean Region (IOR), stated GlobalData at the time.
Analysis reveals that India will spend about $31.6bn on procuring various types of submarines over the next decade. Of this, 30.5% will be directed towards the procurement of Project 75-Alpha SSNs during the same period, with India is expected to acquire a total of six SSNs under this programme at an estimated value of $17bn.
Udayini Aakunoor, defence analyst at GlobalData, commented: “The acquisition of SSNs is a strategic move by India to modernise its Navy and tackle regional security challenges. To be built at the Ship Building Centre located in Vishakhapatnam with participation from the domestic private sector, they are expected to boost the country’s autonomy in complex naval shipbuilding.”
With their unlimited underwater endurance and offensive power, the SSNs will enable India to project power in the Indo-Pacific region while supporting self-reliant advancements in critical defence technologies. These SSNs, coupled with the Indian Navy’s P-8I maritime patrol aircraft, would enhance the service’s ability to detect and track Chinese submarines operating in the IOR, GlobalData suggested.
Aakunoor concluded: “India will also likely use these Project 75-Alpha SSNs to protect its in-service Arihant-class nuclear-powered ballistic missile submarine, which serves as the sea-based leg of the country’s nuclear triad.
“This, in turn, will enhance India’s second-strike capability as the survivability of its fleet of Arihant-class SSBNs will increase significantly owing to the protection provided by the Project 75-Alpha SSNs.”
Russia
Russia is a leading operator of nuclear-powered submarines, with experience charting back decades to the very early stages of the Cold War. More so than its surface fleet, the Russian Navy’s submarine force is extremely capable, with considerable design expertise in the country’s industrial base.
However, determining a proportion of spend on nuclear submarines, relative to overall defence expenditure is a complex proposition in light of Russia’s 2022 invasion of Ukraine and the shift in focus towards a state-on-state ground war and the mobilisation of a wartime economy.
It is thought that up to 40% of Russia’s economy is now directly focussed on defence matters, as Moscow seeks to reassert its old spheres of influence around its borders. Pre-invasion budgets from 2022 indicate that the country’s defence budget was originally slated to value $43.1bn in that year and anticipated to be trimmed down to $41.2bn in 2023, before following a relatively flat trend to reach $44.1bn in 2027.
However, the outbreak of hostilities between Russia and Ukraine eventually culminated in the invasion of Ukraine in February 2022.
As such the Russian government opted to scrap previous plans to trim down defence spending, boosting it to $48.6bn in 2021, which was higher than the previous planned budget of $42.3bn for the same year. The subsequent 2022 defence budget was determined to be in line with this trend, increasing from the previous $43.5bn to $47.3bn.
Despite the opaque nature of current spending in light of the Ukraine-Russia war, according to 2024 data Moscow is forecast to spend nearly $35.5bn over the next ten years on submarine procurement, a sizeable portion of its budget. Although the Ukraine war will take priority, such is the critical nature of Russia’s SSN and SSBN fleets that any prospective cuts will likely be felt by other services before resting on Moscow’s key strategic effectors.
Fleet inventory information held by GlobalData indicates the Russian Navy maintains a sizeable nuclear submarine fleet, including one Losharik-class SSN, up to four Yasen-class SSN, and seven Borei-class SSBNs, which were introduced in 2003, 2013, and from 2013 respectively. It also maintains up to nine Akula-class SSNs, six Oscar-II-class SSNs, and two Sierra-II-class SSNs from the 1980s.
In terms of ongoing and future procurement, the Yasen-class SSNs are slowly being introduced into service in replacement of other ageing classes, with up to 12 submarines planned. Similarly, up to 14 Borei-class SSBNs are also due to be acquired.
United States
For the United States, long since losing quantitative parity with China’s PLAN in terms of surface combatants, the subsurface represents one domain where it still maintains an advantage over the newest claimant to its position atop the global naval podium.
Clearly, the gargantuan nature of the US defence budget enables spending on a scale that few other countries, if any, can match. Analysis indicates that the US defence budget grew by 10.7% in 2023 to $818.8bn, up from $739.5bn in 2022.
The National Defense Authorization ACT (NDAA) for 2024 stipulated an expected defence budget jump of 2.8% to $841.4bn in 2024, figures that excluded spending by the Department of Energy and Atomic Energy Defense Activities from the NDAA total spend. By 2028, the total defence budget is forecast to reach $931.6bn, a positive CAGR from 2024-2028 of 2.6%.
Russia’s invasion of Ukraine and China’s desire to seize the western Pacific from the US means Washington is leaning into its strategic SSN and SSBN capabilities, with the latter also part of a wider recapitalisation of the country’s nuclear triad. All told, Washington is forecast to spend $213.9bn on nuclear submarine acquisition over the next decade.
The US Navy operates around 24 of the older Los Angeles-class SSNs, a design that first entered service in the 1970s, with 62 boats eventually built, and three remaining Seawolf-class submarines, which were intended to replace the aforementioned Los Angeles class.
The newest type of SSN in US Navy service, the Virginia class, was first commissioned in 2024, with 23 boats currently operational and up to 66 planned over the lifetime of the programme.
In terms of SSBNs, the US operates 14 Ohio-class submarines, which carry the US Navy’s nuclear deterrent, as well as four converted Ohio SSBNs armed with cruise missiles and given the SSGN designation.
The replacement Columbia-class SSBN programme is currently planned to produce 12 new ballistic missile submarines, with the first in class projected to enter service in the 2031 timeframe.
Final table
The final table of the five countries with the largest spend on nuclear-powered submarines over the coming decade has shown a domination of states with a Pacific interest, although the comparatively short list of SSN or SSN and SSBN operators is not lengthy, with just the UK and France to add.
Of the final standing, two notable points stand out: the US is going to spend more on its nuclear submarine fleet over the next 10 years than the next four countries combined, a clear indication of the advantage that the US Navy maintains in subsurface warfare.
The second point is that while China are Russia are the pacing threats that the US is measuring itself against, Australia will spend more on the trilateral AUKUS submarine programme, firstly acquiring US Navy Virginia SSNs and subsequently building a new fleet of AUKUS-SSNs with assistance from the UK, than any of the next three countries.
By some margin, Australia’s SSNs will be amongst the most expensive individual submarines ever acquired by a country, which can only be attributed to the cost of entering the US/UK naval nuclear propulsion club.
