Canada’s ambitious $27.7 billion F-35 fighter jet deal with the United States has entered a period of uncertainty, as Prime Minister Mark Carney’s government reviews the purchase amid rising costs and strained relations with President Donald Trump’s administration.
While the Royal Canadian Air Force (RCAF) continues preparations for the arrival of the first 16 jets already under contract, a strategically timed proposal from Sweden’s Saab has injected new complexity into Canada’s fighter procurement debate.
Saab’s Pitch: A Gripen Production Line in Canada
Swedish aerospace firm Saab, which produces the JAS 39 Gripen multirole fighter, has offered to establish a domestic assembly line in partnership with Bombardier if Canada reconsiders its full F-35 order.
The company, already expanding production to meet Ukraine’s 100+ Gripen order, confirmed it is “considering Canada as a third production site after Sweden and Brazil.”
“We confirm discussions with Saab about the Gripen,” said Mark Masluch, Senior Director of Communications at Bombardier, adding that the company is “open to providing local expertise if the government of Canada decides to go this route.”
A joint venture between Saab and Bombardier is reportedly being discussed, offering Ottawa an industrial offset alternative that could strengthen the country’s aerospace manufacturing base.
However, defence officials caution that operating a mixed fleet of F-35s and Gripens could become a logistical and financial challenge.
F-35 Deal Under Review
Canada originally committed in 2022, under Prime Minister Justin Trudeau, to purchase 88 F-35 fighter jets from Lockheed Martin to replace its aging CF-18 Hornet fleet.
Upon taking office, Prime Minister Carney ordered a comprehensive review of the deal amid ballooning costs and mounting political friction with Washington.
The Auditor General’s 2025 report cited “skyrocketing costs, pilot shortages, and inadequate infrastructure,” with the total project cost rising from $19 billion to $27.7 billion.
“We are full steam ahead until we hear otherwise,” testified Deputy Defence Minister Stefani Beck in October, emphasizing that the RCAF continues to prepare training, infrastructure, and staffing for the F-35 rollout.
Nonetheless, the Carney government’s review, initially expected to conclude in the summer, remains incomplete.
Political and Strategic Crosswinds
Canada’s defense relationship with the U.S. has soured in recent months, as President Trump imposed a series of retaliatory tariffs and made controversial remarks suggesting Canada could become the 51st American state.
This political turbulence has fueled speculation that Ottawa may seek greater autonomy in defense procurement, making Saab’s offer particularly timely.
“Gripen for Canada” could give Ottawa a locally built, NATO-compatible alternative that reduces reliance on the U.S. defense supply chain, analysts note.
However, Lt.-Gen. Jamie Speiser-Blanchet, Commander of the RCAF, warned that introducing a second fighter type would be “a costly logistical nightmare” for operations and maintenance.
Industry and International Context
The JAS 39 Gripen—a lightweight, supersonic multirole jet—has seen renewed demand following Sweden’s NATO integration and Ukraine’s procurement program. The aircraft is prized for its agility, low maintenance costs, and interoperability with NATO systems.
Meanwhile, Lockheed Martin continues to face production delays and cost escalations in multiple partner nations.
The Canadian Department of National Defence (DND) has confirmed that its F-35 review report has been submitted to the Prime Minister’s Office, but no final decision has been announced.
Outlook: A Fighter Fleet in Flux
As the Carney government weighs its options, analysts warn that further delays could jeopardize Canada’s air defense readiness.
“The longer the review takes, the harder it becomes to pivot,” said a senior defence analyst. “Every month of uncertainty risks losing delivery slots and operational momentum.”
With Saab publicly courting Canadian industry partners and the F-35 deal under political strain, Ottawa finds itself at a pivotal crossroads — one that could redefine Canada’s air power strategy and defense industrial policy for decades.
