Canada and Saab Sign Term Sheet for Six GlobalEye Aircraft in a $5 Billion Procurement

Sep 27

3 min read

On September 25, 2026, Canada's Defence Investment Agency (DIA) and Swedish defence company Saab signed a non-binding term sheet for the proposed purchase of six GlobalEye airborne early warning and control aircraft for the Royal Canadian Air Force. The procurement has an expected funding envelope of more than $5 billion, making it one of the largest defence projects now in negotiation.

What was signed (and what was not)

This is a step toward a contract, not the contract itself.

What it is: A term sheet that sets the scope and framework for detailed negotiations.
What it covers: Six aircraft, along with associated systems, training and support. Negotiations will focus on the system configuration, industrial participation, capability development and how the program will be carried out.
What it is not: A binding commitment. Ottawa has made no binding commitment to buy the aircraft, although it has signaled a strong intention to reach a deal.
Still unknown: The term sheet is not public, and a final price has not been set. The $5 billion figure is a government funding estimate, not a contract value.

How we got here

May 27, 2026: Prime Minister Mark Carney named Saab the preferred supplier for Canada's future airborne early warning and control capability, announcing it at the CANSEC defence show in Ottawa.
September 25, 2026: The term sheet is signed, moving the project into detailed negotiations.

The project is also one of the first eight procurements the DIA was given to manage when it was set up, a list that also includes the next submarine fleet and Arctic over-the-horizon radar.

The aircraft and the Canadian content

GlobalEye is built on Bombardier's Global 6500 business jet. The airframe is built in the Toronto area, then sent to Sweden to be fitted with surveillance equipment. Carney has said that if Canada buys the planes, they would be militarized in Canada.

At the time of the preferred-supplier announcement, Carney said at least one-third of projected GlobalEye orders for allied countries would be built in Canada, estimated at about 40 aircraft over 15 years.

The project would also require new infrastructure, such as hangars and logistics facilities.

Not without debate

Selecting Saab passed over American options, including Boeing's E-7 Wedgetail and L3Harris's Aeris X. The Conservatives have asked the auditor general and the parliamentary budget officer to look into whether proper processes were followed in the selection. This is one to watch as negotiations continue.

What this means for suppliers

Even without a signed contract, the term sheet signals where defence spending is heading. For Canadian businesses:

Industrial participation is part of the negotiation. The term sheet addresses industrial participation, so Canadian content commitments are likely to shape who gets work.
Look beyond the aircraft. Aircraft militarization in Canada, mission-system integration, training, support, and the new hangars and logistics facilities all create potential supplier and construction opportunities.
Timing is uncertain. With negotiations just beginning and no delivery schedule public, suppliers should plan on a longer horizon.
Expect similar deals. Defence procurement is increasingly built around domestic industrial benefits, so large awards in this space are likely to carry similar requirements.

How to position your business

Track DIA announcements and federal tenders through CanadaBuys and Bids Advantage to catch follow-on opportunities as they appear.
Make your capabilities visible to likely prime contractors and their Canadian partners.
Be ready to document Canadian content and ownership when approaching primes.