Canada considers cancelling part of 88 U.S. F-35 order to buy 60 Swedish Gripen fighters.

Canada is considering a major overhaul of its fighter modernization plan, according to a May 30, 2026, report by La Presse, indicating Ottawa may replace much of its planned 88 F-35 fleet with roughly 60 Saab Gripen fighters while retaining 30 F-35As. This potential shift to a Canada mixed fighter fleet aims to reduce reliance on US defense supply chains and political leverage while preserving core fifth-generation capabilities for NORAD and NATO operations.

The proposed Canada F-35 Gripen mixed fleet combines the stealth advantages of the Lockheed Martin F-35 with the lower operating costs, austere runway capabilities, and extensive technology transfer options of the Saab Gripen E. Beyond the immediate CF18 replacement, this strategy coordinates with the broader Canadian Defense Industrial Strategy to expand sovereign aerospace manufacturing and diversify long-term international defense partnerships.

Related topic: Saab GlobalEye defeats U.S. Boeing Wedgetail for C$5 billion Canada Air Force AWACS contract

Sources indicate that a mixed fleet of roughly 30 Lockheed Martin F-35As and 60 Saab Gripen Es had emerged as the preferred outcome of the government's review of Canada's fighter jet requirements. (Picture source: Czech Air Force)

On May 30, 2026, La Presse indicated that Canada appeared increasingly close to replacing its plan to acquire 88 F-35A fighters with a mixed fleet composed of roughly 30 U.S. F-35As and approximately 60 Swedish Saab Gripen. The shift would represent the most significant change to Canadian combat aviation planning since the F-35's selection in January 2023. The reassessment, originally expected to conclude within three months but still unfinished to date, emerged amid a broader deterioration in Canada-U.S. relations following the trade war with Donald Trump, including threats targeting key Canadian sectors such as aerospace. An official announcement is now expected after the U.S. midterm elections in November 2026, to avoid adding further strain to bilateral relations during a politically sensitive period.

At the same time, Ottawa continued its review of the strategic implications of long-term dependence on American defense supply chains, sustainment networks, and technology ecosystems. By reducing exposure to U.S. economic and political leverage while increasing domestic industrial participation, the mixed-fleet option allows the replacement of the CF-18 fleet while accelerating the diversification of Canada's defense partnerships. The most important hint to date occurred on May 27, 2026, when Prime Minister Mark Carney confirmed that Canada had entered negotiations with Saab for five to six GlobalEye airborne early warning and control aircraft valued at more than C$5 billion.

The competition eliminated Boeing's E-7 Wedgetail and L3Harris' Aeris proposal despite both offering established American-linked solutions. The procurement, expected to create over 3,000 local jobs, addresses a long-standing operational gap because Canada currently possesses no sovereign airborne early warning fleet and relies heavily on American airborne command-and-control assets for surveillance and battle management. The GlobalEye acquisition provides an independent capability built around Saab's Erieye ER radar and Bombardier's Global 6500 airframe.

More importantly, the procurement established a precedent showing that industrial participation, technology transfer and domestic aerospace production could outweigh the advantages traditionally associated with purchasing from larger American defense contractors. Once Ottawa selected Saab in the airborne surveillance segment, it became increasingly difficult to separate the fighter competition from broader industrial policy objectives. Prime Minister Mark Carney's Canadian Defense Industrial Strategy, unveiled in February 2026, provides the broader framework within which major defense procurement decisions, such as submarines, are now being evaluated.

The strategy calls for nearly C$500 billion in defense-related investment over the next decade and seeks to increase annual defense spending from approximately C$60 billion today to the equivalent of 5% of GDP by 2035. The centerpiece of the plan is a restructuring of Canada's defense-industrial base rather than a simple increase in military expenditures. For decades, roughly 75% of Canadian defense procurement spending has flowed to American suppliers, reflecting the deep integration of North American defense markets. The new strategy seeks to reverse that pattern by ensuring that Canadian companies secure approximately 70% of future defense contracts through domestic production, technology development, sustainment activities, and export-oriented manufacturing.

The objective is to expand sovereign industrial capacity across aerospace, naval construction, land systems, munitions, artificial intelligence, and advanced technologies while reducing exposure to external supply chain disruptions and foreign political leverage, two vulnerabilities that became particularly apparent during Donald Trump's second presidency. The approach currently favored within the federal cabinet is to divide the original fighter acquisition roughly in half rather than proceed with the full 88-aircraft F-35 fleet approved in 2023. Under this model, Canada would retain a core force of approximately 30 F-35As to preserve fifth-generation capabilities for NORAD and NATO operations, while acquiring about 60 Saab Gripen Es to replace the remainder of the CF-18 fleet and support broader industrial objectives.

The legal and financial constraints surrounding the program make such a compromise possible. Ottawa is legally committed only to the first 16 F-35As, and Canada has already invested billions of dollars in infrastructure, training, sustainment preparations, and program participation. Those aircraft are effectively locked into the force structure. The remaining 72 fighters, however, have not been covered by a signed production contract (a fact substantially different from the public perception) and therefore remain available for cancellation, reduction or substitution. Therefore, payments made during 2026 for long-lead components associated with 14 F-35s preserve production slots and procurement flexibility but do not constitute a binding commitment to complete the original 88-aircraft purchase. 

Relations between Ottawa and Washington also deteriorated sharply after the imposition of 25% tariffs on Canadian products, threats of 50% tariffs on Canadian aircraft and Bombardier certification cancellation inside the U.S. Still, reducing the F-35 fleet in response presents a fundamentally different problem from cancelling the F-35 program entirely. A complete F-35 withdrawal by Canada would affect infrastructure investments, training plans, industrial participation agreements, and nearly three decades of involvement in the Joint Strike Fighter program. The F-35 program supports approximately 4,500 Canadian jobs across more than 30 companies and is projected by Lockheed Martin to generate about C$15.5 billion in industrial participation opportunities for Canadian industry through 2058.

By contrast, a mixed fleet preserves access to fifth-generation capabilities while allowing Ottawa to redirect part of its procurement budget toward a different industrial model. A mixed fleet, therefore, offers a compromise that reduces dependence on a single supplier without forcing the government to absorb the political and financial consequences associated with abandoning the program altogether. In contrast, Saab's economic proposition differs fundamentally from the industrial model associated with the F-35 program and has become one of the strongest arguments supporting a Gripen acquisition.

Under its "Built for Canada by Canadians" campaign, Saab has offered extensive technology transfer, domestic assembly, sovereign maintenance capabilities, local software development, engineering participation, and the creation of a Canadian research and development center supporting future upgrades and export activities. Rather than limiting Canadian firms to participation within a global supply chain, the proposal seeks to establish a complete aerospace ecosystem inside Canada, covering production, sustainment, training, and advanced development. Depending on production volumes and export opportunities, Saab projects between 6,000 and 12,600 Canadian jobs over the life of the program.

The regional implications are particularly significant for Quebec, where Montreal remains the center of Canada's aerospace industry. A Gripen production and support hub would generate work for Bombardier, CAE, Héroux-Devtek, and hundreds of specialized suppliers throughout the province. For Industry Minister Mélanie Joly, the Swedish proposal offers a mechanism to direct billions of dollars toward Quebec's aerospace sector while advancing broader objectives related to regional equity, industrial diversification, and long-term domestic manufacturing capacity. 

Saab's Gripen E offers several characteristics that align with Canada's operational and budgetary requirements. The aircraft was designed for dispersed operations from austere locations and can operate from road bases as short as 800 meters, a concept developed during the Cold War to ensure survivability against attacks on fixed airfields. Turnaround times are typically cited at around 10 minutes for air-to-air missions with a small ground crew, compared with approximately 30 minutes for the F-35A under favorable conditions. Saab estimates operating costs at approximately US$7,000–10,000 per flight hour, substantially below estimates for the F-35A, which have generally ranged between US$30,000 and US$40,000 per flight hour despite recent reductions.

The Gripen E also offers greater flexibility in weapons integration, including the Meteor, IRIS-T, AIM-120 AMRAAM, Taurus KEPD 350, and various precision-guided munitions. Its electronic warfare suite, built around the Leonardo ES-05 Raven AESA radar, Skyward-G infrared search-and-track system, and integrated electronic attack capabilities, was also designed specifically to counter advanced Russian air defense networks operating in the Arctic region. Although the F-35 retains clear advantages in low observability, sensor fusion, and penetration of heavily defended airspace, the Gripen offers lower acquisition and sustainment costs, greater sovereign control over software and upgrades, reduced logistical requirements, and broader opportunities for domestic participation. 

Saab strengthened its position further by linking the Gripen proposal to Ukraine. During CANSEC, company representatives outlined a concept under which Canadian facilities could manufacture Gripens not only for the Royal Canadian Air Force but also serve as the primary source of future Gripen deliveries to Ukraine, which could reach up to 100 to 150 units. The proposal emerged as Sweden disclosed a potential sale of up to 20 Gripen E/Fs for Ukraine alongside a separate transfer of 16 older Gripen C/Ds. Construction of a single Gripen typically requires roughly 36 months, making local production capacity an important factor if future export orders materialize.

The model resembles Saab's industrial arrangement in Brazil, where domestic production, technology transfer and local assembly became integral elements of the program. Export manufacturing fundamentally changes the economics of a fighter acquisition because production extends beyond national requirements. For Ottawa, such an arrangement would transform defense procurement from a finite purchase into a continuing aerospace manufacturing activity capable of generating employment, sustaining supply chains and supporting future exports over decades. 

The proposal also intersects with broader European debates regarding the financing of Ukrainian military reconstruction. Several European governments have supported using proceeds generated from frozen Russian sovereign assets to fund Ukrainian defense procurement, while the European Union has expanded mechanisms for financing military assistance and industrial production. A Canadian Gripen assembly line could therefore position Ottawa to participate directly in future multinational procurement programs financed through European institutions rather than relying exclusively on Canadian defense budgets.

The concept also carries political implications inside Canada. The New Democratic Party (NDP) has repeatedly argued that Canada should pursue a more independent foreign and defense policy while maintaining support for Ukraine and NATO. A Canadian-operated Gripen production hub aligns with that approach by combining military assistance, industrial development and a visible international role that does not depend entirely on American defense programs. Whether such export orders ultimately materialize remains uncertain, but the proposal introduces a strategic dimension absent from the F-35 debate.

The question is no longer limited to which aircraft Canada should fly; it also mirrors the new U.S. policy in which fighter procurement can be leveraged to create a long-term national manufacturing advantage. Furthermore, Minister David McGuinty confirmed recently that Canada is looking beyond the F-35/Gripen debate by exploring entry as a partner into the Global Combat Air Programme (GCAP) alongside the UK, Japan, and Italy to co-develop a sixth-generation fighter jet.

Written by Jérôme Brahy

Jérôme Brahy is a defense analyst and documentalist at Army Recognition. He specializes in naval modernization, aviation, drones, armored vehicles, and artillery, with a focus on strategic developments in the United States, China, Ukraine, Russia, Türkiye, and Belgium. His analyses go beyond the facts, providing context, identifying key actors, and explaining why defense news matters on a global scale.

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