U.S. President Donald Trump backs the $368 billion U.S.-Australia submarine deal and is committed to ensuring off-the-shelf boats are delivered on time, his top defence official says.
U.S. Defense Secretary Pete Hegseth hosted Australia’s Defence Minister Richard Marles in Washington on Saturday in his first meeting with a foreign counterpart since being appointed on Jan. 29.
The pair primarily discussed the trilateral AUKUS alliance, including the nuclear-powered submarines deal that amounts to Australia’s largest capital purchase in history.
Hegseth offered the first indication of Trump’s support for the AUKUS deal in the absence of any comment from the returning president.
“The president is very aware, supportive of AUKUS,” Hegseth told reporters during his meeting with Marles.
“[The president] recognises the importance of the defence industrial base.”
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U.S. Secretary of Defense Pete Hegseth (R) and Australian Deputy Prime Minister and Defense Minister Richard Marles (L) participate in a bilateral meeting at the Pentagon in Arlington, Virginia on Feb. 7, 2025. Alex Wong/Getty Images
Ahead of the meeting, Australia announced it had made the first of six US$500 million (A$797 million) payments to boost the capacity of the troubled U.S. submarine industry.
Australia will buy three to five off-the-shelf Virginia-class submarine vessels in the early 2030s as it prepares a domestic industry.
But U.S. shipbuilders have struggled to produce the two-submarines-a-year that the U.S. government is procuring.
Hegseth said he “sure hopes” his country could fulfil the deal as Marles described the US$3 billion injection as a “very unique and significant step” in the alliance.
In a later press conference, Marles would not say if the United States had indicated it would ask for more cash.
“This is the agreement that we have,” he said.
We are really happy with the conversations that we’ve had with the Trump administration in relation to this.
“The optimal pathway—which is now underpinned in a trilateral treaty between our three countries [including the UK], which I signed in Washington back in August of last year—is an agreement that is going to endure over decades.”
Australian Deputy Prime Minister and Defense Minister Richard Marles speaks during a bilateral meeting with U.S. Secretary of Defense Pete Hegseth at the Pentagon in Arlington, Virginia on Feb. 7, 2025. Alex Wong/Getty Images
Australia’s military budget is expected to rise to 2.3 percent of GDP by 2034, putting it in line with current spending by the UK and ahead of France, and China.
The AUKUS deal, which will enhance Australia’s maritime and modern warfare capabilities, has been contentious since the day it was struck in 2021.
Former Labor Minister Peter Garrett, in comments published on Saturday, said AUKUS had taken Australia’s subservient relationship with the US to “a new dangerous, illogical and expensive extreme.”
While the Australian Strategic Policy Institute has raised concern about the complexity of the subs deal and the “unknowable” costs of the modern warfare arm.
The Albanese Labor government is meanwhile continuing to ward off any potential U.S. tariffs on the nation’s exports as it highlights the trade surplus the United States has with Australia.
Trump overnight said he planned to announce reciprocal tariffs on many countries within days, ratcheting up his bid to reshape global trade.
“We will continue to press the Australian case around the question of trade,” Marles said.
“We are an island trading nation where trade forms an increasing share of our national prosperity.”
Australia, which tore up its $90 billion diesel-powered submarine deal with France to sign on to AUKUS, will buy several off-the-shelf submarines, costing about US$4 billion each, before making its own.
The first Australian-made boats are due to be operational in the 2040s.
By Luke Costin with Reuters.
