Saab’s Gripen Proposal Puts Canada’s F-35 Plan Under Pressure

Saab of Sweden is seeking to exploit an unusual opportunity in North American defence policy. Its proposal would have Canada fly Gripen E/F fighters alongside US-made F-35s, while transferring part of the aircraft’s production to Canada.

Saab sees an opportunity amid US–Canada tensions

The Swedish group is advocating a “dual fleet” approach. Under the plan, Canada would continue with its F-35 purchase but also introduce Gripens, reducing its reliance on US equipment and political support.

During an investor call, Saab chief executive Micael Johansson said Canadian officials are considering how not “to be too dependent on the US” for combat airpower. In response, Saab has supplied substantial technical and industrial information in support of its proposal.

Saab is feeding Ottawa detailed information on the Gripen’s technology transfer, production timelines and long-term export potential, betting that strategic autonomy now matters as much as raw performance.

The proposal comes at a delicate point in relations between Washington and Ottawa. Public threats by former US President Donald Trump, along with a pointed warning from US Ambassador to Canada Pete Hoekstra over Canada’s long-planned F-35 acquisition, have strained ties.

What Saab is offering Canada

Saab has structured its proposal to appeal both to Canadian defence planners and to the country’s aerospace sector. The offer concerns more than the aircraft themselves: it also addresses their location and method of manufacture.

Gripen local production and technology transfer

Johansson told investors that Saab has given Canada detailed information on how quickly it could establish a domestic Gripen production line, as well as the amount of technology it would be willing to transfer.

• Creation of a Canadian final-assembly and production facility
• Transfer of important manufacturing and maintenance expertise
• Use of the Canadian line to produce Gripens for other export customers

Saab is also setting out how Canada could participate in future worldwide sales should Ottawa select the fighter.

Saab is framing the Gripen offer not just as a purchase, but as an entry ticket into the global fighter export business.

The company already operates two Gripen manufacturing lines: one in Sweden and one in Brazil. A Canadian plant would become the third, and Saab says it could serve as a centre for selected international orders.

An expanding export portfolio

The Gripen E/F is steadily gaining customers, something Saab hopes will assure Canadian decision-makers that they would not be the only operators.

Country	Gripen deal	Approximate value
Brazil	Continuing Gripen E/F production and deliveries	Multi-billion dollar programme
Colombia	17 aircraft ordered (2025 agreement)	€3.1 billion (around $3.7 billion)
Thailand	Four additional aircraft	5.3 billion Swedish kronor
Ukraine	Letter of intent for 100–150 aircraft	Potentially one of Saab’s largest deals

Saab is increasing its manufacturing capacity as well. A company executive recently said it aims to produce 36 Gripens annually, a target that an additional North American production line would make easier to achieve.

Canada reconsiders its F-35-only plan

Canada is already committed to the US-led F-35 programme and currently intends to buy 88 aircraft as replacements for its ageing CF-18 fleet. The 2023 budget was set at 27.7 billion Canadian dollars (around $20.3 billion), although that amount is being reviewed.

Despite the political backdrop, Ottawa is still proceeding with an initial order of 16 F-35s. Eight are scheduled for delivery to Luke Air Force Base, Arizona, between 2026 and 2027, where they will support pilot training.

However, the government is privately reassessing how much of its future combat-air capability should depend on a single aircraft supplied by one ally. An Auditor General report said the F-35 plan was being reassessed “to ensure” the aircraft remains the “best choice” for Canada’s needs.

That change in language has evidently encouraged Saab. A senior Canadian official had previously called the Swedish proposal “very interesting”, suggesting that a mixed-fleet solution is now being considered in a way that it was not several years ago.

US pressure and industrial leverage

Analysts argue that Washington retains substantial leverage should Canada cut its F-35 order. Bryon Callan of Capital Alpha Partners told investors that a decision to “truncate” the 88-aircraft plan could have consequences for Canadian businesses.

More than 30 Canadian aerospace companies are tied into F-35 production work, a powerful economic lever for the US if Ottawa shifts away from the programme.

Most of these companies supply parts and services throughout the F-35 supply chain, securing long-term, high-value contracts. A smaller Canadian purchase could weaken the rationale for their continuing participation.

Callan also identified a further weakness in Saab’s proposal: the Gripen E uses the US-built GE Aerospace F414G engine. In an extreme scenario, US export restrictions on the engine could become a source of pressure even if Canada acquired Gripens.

Nevertheless, Callan called Ottawa’s wish to diversify its defence suppliers “prudent”, given Trump’s public threats that questioned Canada’s defence commitments and sovereignty decisions.

High-stakes timing and political calculations

Johansson would not predict when Canada might decide on Gripen, emphasising that “high-level political decisions” will ultimately determine the result. Saab is holding “intensive discussions” with the Canadian side, he said, but no firm timetable exists.

A move to a dual fleet would have to reconcile several competing considerations:

• Canada’s NATO and NORAD commitments
• Existing contractual and industrial connections to the F-35 programme
• Domestic industrial gains from a potential Gripen production line
• Relations with Washington and wider US defence policy

For Ottawa, this is not solely a technical decision. The F-35 provides stealth capability and close integration with US forces, whereas a second fighter type could give Canada greater influence over its aircraft’s upgrades, maintenance and associated export controls.

GlobalEye, NATO and Saab’s wider Canadian ambitions

Saab’s Canadian discussions extend beyond fighter aircraft. Johansson said he is closely following Ottawa’s development of a new surveillance-aircraft requirement, which is widely expected to include a proposal for Saab’s GlobalEye airborne early warning and control platform.

GlobalEye pairs a Bombardier Global business-jet airframe with advanced radar and sensors, many of which can be adapted to national requirements. Canada’s extensive maritime and Arctic surveillance demands make it a natural prospect.

Meanwhile, Saab is awaiting a NATO decision on a possible GlobalEye contract as the alliance looks for a replacement for its ageing E-3 Sentry fleet. NATO had previously considered Boeing’s E-7A Wedgetail, but that option was set aside, giving GlobalEye another opportunity.

What a dual fleet would mean in practice

Operating both F-35s and Gripens would create added complexity for the Royal Canadian Air Force, but would also deliver greater flexibility. Two fighter types require separate training routes, logistics networks and simulators, while also providing more choices during a crisis.

In operational terms, Canada could use its F-35s for tasks in which stealth and deep penetration of defended airspace are essential, including the opening stages of a NATO air campaign. Gripens could perform quick reaction alert duties domestically, Arctic patrols and many coalition operations where stealth is less vital.

A dual fleet could also protect Canada against the risk of a grounding. If a technical problem halted one fleet’s operations, the other could remain airborne. That redundancy has genuine operational importance for a country tasked with monitoring huge areas of northern airspace.

Key terms and risks to understand

Technology transfer and industrial participation are central to the debate. Technology transfer describes the level of design and manufacturing knowledge that a supplier will share, enabling local businesses to build, repair and upgrade systems independently. Industrial participation covers the wider package of employment, facilities and export work connected to an agreement.

Saab has traditionally promoted itself as generous in both areas, whereas the US is generally more restrictive, particularly concerning sensitive stealth technologies. This difference partly explains why the Gripen proposal appeals to Canadian industry, but it brings risks too. Significant reliance on overseas technology, even under transfer agreements, can remain vulnerable to political changes, export restrictions or sanctions in supplier nations.

For Canada, the issue is not simply choosing a “winner”, but deciding how to balance sovereignty, alliance politics and value for money over decades. The Gripen proposal introduces a new factor to that calculation, strengthening Ottawa’s negotiating position while increasing the stakes with its closest ally.