The US Defense Department has launched a review of the AUKUS agreement to ensure it complies with the Trump administration’s America first agenda.
That could imperil Australia’s plans to acquire US Virginia-class nuclear attack submarines, a fundamental component of Australian security policy.
The review was announced overnight by a spokesman for the US Department of Defense.
“The Department is reviewing AUKUS as part of ensuring that this initiative of the previous administration is aligned with the President’s America first agenda,” the spokesman wrote. “This review will ensure that that the initiative meets those common sense America first criteria.”
The statement did not say over what time frame the review would be conducted and just why it was initiated.
The US Naval Institute added some more details. It said the Office of the Secretary of Defense Pete Hegseth was conducting a review of the AUKUS agreement.
“As Secretary Hegseth has made clear, this means ensuring the highest readiness of our service members, that allies step up fully to do their part for collective defense, and that the defense industrial base is meeting our needs,” the official said.
US news website Politico said Pentagon policy chief Elbridge Colby — who has expressed skepticism about the worth of AUKUS— is conducting the review.
“Any changes to the administration's approach for AUKUS will be communicated through official channels, when appropriate,” a spokesman said.
AUKUS is Australia's biggest-ever defence project, with Australia set to spend $368 billion over 30 years. That includes billions of dollars of investment in the US production base.
The AUKUS agreement between Australia, the US and UK, was launched in 2021 under the former Democrats administration of President Joe Biden.
The key element is creating a pathway for Australia to acquire nuclear powered but not nuclear armed submarines with the US agreeing to provide nuclear propulsion technology that it has only previously shared with the United Kingdom.
The agreement led to Australia’s cancellation of a deal with Naval Group of France for Australia to build conventionally powered submarines.
Under the AUKUS Optimal Pathway agreement announced in May 2023, starting from around 2032 and pending Congressional approval, the US plans to sell three Virginia class SSNs to Australia with the potential for sale of two more if needed.
In the early 2040s the Royal Australian Navy will take delivery of the first UK-design Australian-built SSN-AUKUS.
The Trump administration has conveyed mixed signals on AUKUS.
Politico said Colby has challenged major parts of the AUKUS deal, including the plan to sell the three Virginia-class SSNs to Australia, citing the need for the US to maintain a robust undersea presence in the Pacific.
But he appeared more amenable to AUKUS in his Senate confirmation hearing in March, saying it should be the policy of the United States government to do everything we can to make this work.
US Democrats aren’t happy that the agreement could be in jeopardy.
Joe Courtney, the leading Democrat on the House Armed Services sea power sub-committee, queried why the administration would launch this review when so much was happening.
“To walk away from all the sunk costs invested by our two closest allies, Australia and the United Kingdom, will have far-reaching ramifications on our trustworthiness on the global stage,” he said. “It is a direct contradiction to the administration’s America first, but not alone goal of countering aggression from China, Russia and other adversaries.”
A fundamental issue is that US shipyards just aren’t producing new SSNs fast enough to meet US Navy requirements, let alone supplying boats to Australia.
In February, Australia made the first down payment of US$500 million to the US to boost the capacity of its shipbuilding industry.
That’s apparently not refundable if the AUKUS agreement collapses.