Australia quietly sent non-refundable $1.5 billion to US for AUKUS ‘down payment’ last month
Australia quietly sent another $1.5 billion to the United States in a non-refundable down payment for AUKUS in December, The Nightly can reveal.
The payment was the third instalment of a total of $4.5 billion ($US3 billion) that Australia is contributing to help speed up the manufacturing of America’s Virginia-class nuclear-powered submarines.
It was also the largest tranche of money, following two payments of $750 million apiece made earlier in 2025.
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By continuing you agree to our Terms and Privacy Policy.The remaining $1.5 billion — an amount likely to increase as the dollar figure is adjusted for inflation — will be slowly paid over the next decade.
The money was agreed as a key part of the AUKUS pact to speed up the rate of production for Virginia-class submarines to enable the US to sell at least three to Australia.
Under the agreement, America will only transfer the nuclear-powered submarines to Australian ownership from 2032 if the president at the time is satisfied doing so won’t be detrimental to its own naval capability.
In the years since the AUKUS pact was struck, a raft of American politicians, defence figures and administration officials have raised concerns that its pace of submarine-building was too slow for its own purposes, let alone being able to send boats down under.
But US President Donald Trump said the pact was “full steam ahead” during his meeting with Prime Minister Anthony Albanese in October.
“It was going too slowly . . . we’ve worked on this long and hard, and we’re starting that process right now. And I think it’s really moving along very rapidly, very well,” Mr Trump said.
His “full steam ahead” pronouncement was echoed by all parties during ministerial talks in Washington in early December.
Defence Minister Richard Marles joined Foreign Minister Penny Wong with their counterparts Pete Hegseth and Marco Rubio for the annual AUSMIN talks, followed by an AUKUS-specific discussion that also involved British Defence Minister John Healey.
These talks came shortly after the Pentagon finalised a review of AUKUS.
Mr Marles said at the time the US was seeking some changes to arrangements, although he wouldn’t elaborate on what they were, while Mr Healey said everyone was now working on a “reboot” of AUKUS.
The key focus now was delivery, Mr Marles said in Washington.
“This is a massive, massive task and it’s really important that we all have our shoulders to the wheel, all three systems working in a coordinated way to make this occur, and that’s what we’ve committed to,” he said.
“We do need to be moving at a pace, and we should have challenging timelines, but we are really confident that we can meet them.
“A key immediate milestone is quarter four of 2027 which is the beginning of the Submarine Rotational Force — West. We’re on target to achieve that.”
Australia initiated the third AUKUS down payment in December, although the Government would not confirm the exact timing of that transfer and whether it coincided with the AUSMIN and trilateral meetings.
Australia is also investing about $4.8 billion over 10 years in the Rolls Royce factory in the UK that is making the nuclear powered engines for existing British submarines and the new SSN-AUKUS model once it starts production.
