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US Debates its Virginia-Class Submarine Strategy as China Expands its Presence in Indo-Pacific.
On March 21, 2025, a Congressional Research Service report highlighted key concerns and challenges related to the Virginia-Class attack submarine program and the AUKUS (Pillar 1) project. The report underscores the difficulties faced by the U.S. Navy in submarine production and the strategic and industrial implications of selling several units to Australia. The slowdown in the construction rate of Virginia-Class submarines and the growing backlog raises critical questions about the United States’ ability to maintain its submarine fleet while fulfilling international commitments.
On August 22, 2024, sailors aboard the Virginia-class fast-attack submarine USS Hawaii (SSN 776) prepared to moor at HMAS Stirling in Western Australia (Picture source: US DoD)
Since 1998, the U.S. Navy has been building Virginia-Class submarines to gradually replace the aging Los Angeles-Class. However, despite an initial goal of producing two submarines per year, this target has never been met. Since 2022, the actual production rate has dropped to approximately 1.2 submarines per year, creating a backlog that concerns defense officials. The Navy is currently working to increase this rate to two submarines per year by 2028, with a long-term goal of reaching 2.33 units annually.
Virginia-Class submarines are designed for underwater warfare, surveillance, reconnaissance, and precision strikes using Tomahawk missiles. Equipped with nuclear propulsion, they have near-unlimited range and can operate discreetly in strategic areas. Since their introduction in 2004, several upgrades have been implemented, including the Virginia Payload Module (VPM), which increases missile-carrying capacity. This modification allows the latest submarines to carry up to 28 additional cruise missiles, enhancing their long-range strike capability.
The 2025 budget includes funding for only one submarine, whereas initial projections anticipated two. This decision is attributed to budget constraints and the need to stabilize the industry while addressing the backlog. However, some members of Congress advocate for funding a second submarine, arguing that it would provide greater industrial stability and send a clear message to rival powers, particularly China.
The AUKUS project marks a significant shift in strategic cooperation between the United States, the United Kingdom, and Australia. Announced in September 2021, it aims to provide Australia with nuclear-powered submarine capabilities. Under this agreement, four U.S. submarines and one British submarine will rotate through Australia starting in 2027. Between 2032 and 2038, the United States plans to sell between three and five Virginia-Class submarines to Australia while supporting the construction of SSN AUKUS-class submarines in Australia in collaboration with the United Kingdom.
This transfer of submarine capabilities seeks to strengthen Western military presence in response to China's growing naval power. However, the sale temporarily reduces the U.S. fleet by several units before replacements are delivered, a process that could extend until 2049. This reduction in operational submarines raises concerns about the United States’ ability to maintain its undersea dominance and fulfill deterrence objectives in the Indo-Pacific.
In this region, China’s maritime expansion remains a key concern for Washington and its allies. Beijing has significantly increased its submarine fleet and power projection capabilities, notably through the expansion of its nuclear-powered submarine fleet and the militarization of strategic islands in the South China Sea. This development is part of a broader strategy to challenge U.S. maritime supremacy and restrict Western military movements in the region. The Indo-Pacific has thus become a central theater of U.S.-China competition, where control over shipping lanes, resource-rich areas, and key strategic points plays a crucial role in maintaining the balance of power.
The U.S. naval industry faces a significant challenge in meeting the increasing demands of the Navy and AUKUS allies. Since 2018, Congress has allocated nearly $9.8 billion to strengthen the industrial base, improve infrastructure, expand subcontracting, and train a skilled workforce. Despite these efforts, approximately 70% of key suppliers in the submarine industry operate under monopolistic conditions, making the supply chain vulnerable and potentially affecting production timelines. Delivering submarines on schedule while maintaining quality and operational effectiveness remains a priority concern.
Congress must navigate several priorities: sustaining the national industrial base, ensuring U.S. undersea superiority amid China’s growing capabilities, and honoring commitments to Australia. The decision to fund one or two Virginia-Class submarines in 2025, along with broader industrial investments and AUKUS implementation, will have significant implications for power dynamics in the Pacific.
While the AUKUS project strengthens strategic alliances and bolsters U.S. influence in the region, it also raises questions about the Navy’s ability to maintain its submarine fleet at a necessary level. The decisions made in the coming years will have a lasting impact on U.S. strategy in response to China’s expansion and the overall geopolitical balance in the Indo-Pacific.