Australia pays US another $525 million to bolster AUKUS industrial base

Australia’s Prime Minister Anthony Albanese arrives onstage after winning the general election at the Labor Party election night event in Sydney on May 3, 2025. Left-leaning Prime Minister Anthony Albanese triumphed on May 3 in Australia’s general election, according to media projections, prevailing in a vote shaped by inflation woes and Trump tariffs. (Photo by Saeed KHAN / AFP) (Photo by SAEED KHAN/AFP via Getty Images)

SYDNEY — Australia, in the midst of a Pentagon review of the AUKUS submarine program, has announced a second payment of $800M AUD ($525 million USD), meaning the Lucky Country has now invested $1.6 billion AUD to the three-nation effort.

Prime Minister Anthony Albanese confirmed the $525 million USD payment in an interview with Australian Broadcasting Corporation this afternoon, saying “we support AUKUS. We have an agreement.”

It’s a tiny part of the $368 billion AUD Albanese’s government has pledged to spend on the entire program.

Australia had pledged to make regular payments to the US to boost the submarine industrial base to help increase production rates of the US Navy, which has struggled to produce two Virginia-class submarines annually to meet its requirements. With the current production rate, America will struggle to produce enough boats to meet its needs, let alone make another three for Australia.

Less clear is whether that money also goes to cover costs for US personnel to train Australian sailors so they can man and maintain the nuclear powered attack subs. Royal Australian Navy personnel have graduated from the US Navy’s nuclear school and learned how to maintain reactors and the systems that keep them running.

“There’s a schedule of payments to be made. We have an agreement with the United States as well as with the United Kingdom, it is about increasing their capacity, their industrial capacity,” Albanese said.

“As part of that as well, we have Australians on the ground, learning those skills.”

While these investments had previously been announced, it is impossible to ignore the timing of the latest payment.

It comes as Elbridge Colby, the US undersecretary of defense for policy, ordered a review of the AUKUS agreement to assess if it is “aligned” with President Donald Trump’s “America First” agenda. That, in turn, has set off increasing discussions among the defense community here about America’s commitment to AUKUS and to its Australian treaty ally.

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Author: Colin Clark

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