On 26 April 2016, Prime Minister Malcolm Turnbull announced the Shortfin Barracuda, a conventionally-powered variant of the Barracuda-class nuclear submarine by French firm DCNS (now Naval Group), as the winner.

[13][14] Built during the 1990s and 2000s, the Collins-class submarines have a predicted operational life of around 30 years, with the lead boat HMAS Collins due to be decommissioned around 2025.

[16] In December 2007, a month after coming into office, Minister for Defence Joel Fitzgibbon announced that planning for the Collins-class replacement (designated SEA 1000) had commenced.

[17] The 2009 Defending Australia in the Asia Pacific Century: Force 2030 white paper confirmed the replacement project, and announced that the submarine fleet would be increased to twelve vessels.

[17] However, meetings between Moffitt and the National Security Committee to clarify concept details and intended capabilities scheduled for November 2009 did not go ahead until March 2012.

[17] Some of the slow pace and lack of decision making has been attributed to politicians fearing being held responsible for a repeat of the problems experienced by the Collins class during their construction and early career.

[27] Advantages in such a deal between the nations include the attention that securing the SEA 1000 project would bring to Japanese arms manufacturers (particularly after loosening of defence export restrictions in 2014), the provision of a proven high-end submarine design to the Australian military, and improved relations, both directly and as mutual allies of the United States of America.

[28] However, it has been noted that cooperation on such a major defence project would be high risk due to Japan's lack of previous arms export experience, and any deal could negatively impact on both nations' relations with China.

[29] The close personal relationship between the then-Australian Prime Minister Tony Abbott and Japanese Prime Minister Shinzō Abe was also cited as a factor in the likeliness of such a deal, although with the caveat that a change in government in either nation would compromise any potential deal for construction, or the ongoing maintenance support of the submarines: the Australian Labor Party has a greater interest in supporting local shipbuilding than Abbott's Coalition government, while a souring of China-Japan relations is something the Democratic Party of Japan is less likely to risk than the Liberal Democratic government led by Abe.

[31] In December 2014, the Australian Coalition government ruled out using a tender process to identify a new submarine design, blaming the limited time left before the Collins class were scheduled to begin leaving service.

[36] On 20 February 2015 the Australian Government announced three key strategic considerations that would be taken into account in the competitive evaluation process: that the future submarines would have a similar range and endurance to the Collins class, superior sensor performance and stealth compared to the Collins class, and that the combat system and Mark 48 Mod 7 torpedo jointly developed between the United States and Australia would be the future submarines' preferred combat system and main weapon.

[38] Deciding the future submarines' propulsion system is closely tied to determining its operational range, underwater endurance, and stealthiness.

The option of nuclear propulsion effectively gives submarines an unlimited range and endurance, only restrained by maintenance and human crew requirements for resupply and rest.

Air independent propulsion performs the role of an auxiliary engine, providing submarines with increased stealth by allowing them to operate submerged for longer.

The German Type 214 submarine employs advanced polymer electrolyte membrane fuel cells that assist in delivering it comparable range and endurance to the Collins class.

The Australian Government's announcement on 20 February 2015 that the future submarines would have a similar range and endurance to the Collins class increased the likelihood that an evolved MOTS or completely new design would be selected.

The 2009 defence white paper identified a land strike capability as an important addition to torpedo, mine and anti-ship missile weapons.

[11][30] On 30 November 2015, DCNS with Thales delivered its proposal for the Shortfin Barracuda Block 1A design (a diesel-electric variant of the Barracuda-class nuclear submarine under construction for the French Navy) to the Australia's Department of Defence.

[11][60] An unspecified number of Sōryū-class submarines, built in Japan by Mitsubishi Heavy Industries and Kawasaki Shipbuilding Corporation was estimated at A$25 billion.

[73] A trilateral discussion was held between British prime minister Boris Johnson, US president Joe Biden and Morrison at the June 2021 G7 summit in Cornwall, England.

[75] On the day the contract was cancelled, Morrison, Johnson and Biden jointly announced the creation of the AUKUS trilateral security pact.

[7] The basic design and key technologies will be decided by the Nuclear-Powered Submarine Task Force, an 18-month Department of Defence research project headed by Vice Admiral Jonathan Mead, begun in September 2021 with assistance from the US and UK.

[87] The French Ministry of Defense claimed that on the day that the contract was cancelled, Australia had written to France stating that "they were satisfied with the submarine's achievable performance and with the progress of the program.

"[89] Christian Cambon, chairman of the Committee of the French Senate's Foreign Affairs, Defence and Armed Forces, said the decision to cancel the contract must lead France "to wonder about the recurrent attitude from some of our allies, behaving as adversaries rather than fair competitors".

In addition, the Australian Prime Minister Anthony Albanese announced plans to travel to France to repair bilateral relations between the two countries.