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Australia may face higher AUKUS costs and pressure to join US-China conflict

10 July, 2025

Australia’s nuclear submarine deal under AUKUS could become more costly and politically fraught, as the US Department of Defence reviews the trilateral agreement under President Donald Trump’s “America First” agenda.

A report from The Age reveals that the Pentagon is considering changes that could see Australia pay more than the current $4.7 billion price tag for Virginia-class submarines, and be required to deploy them in support of US forces in a potential conflict with China over Taiwan.

While Defence Minister Richard Marles dismissed concerns about the review, noting similar reassessments in the UK that reaffirmed support for AUKUS, the revelations suggest deeper tensions within the US foreign policy establishment.

Elbridge Colby, the US Undersecretary of Defence and a known sceptic of the submarine deal with Australia, is reportedly driving the push for stricter conditions.

Though AUKUS has enjoyed broad bipartisan support in the US since it was brokered by President Joe Biden, former Prime Minister Scott Morrison, and former UK Prime Minister Boris Johnson, Trump’s return to power and his unpredictable foreign policy moves have reignited uncertainty.

The Defence Department said in June the review aims to ensure AUKUS aligns with national interests, but no whole-of-government directive has been issued. US Secretary of State Marco Rubio has claimed he was unaware of the review at the time.

Australia’s strategic position, especially regarding potential military entanglement in a Taiwan conflict, may now come under heavier scrutiny in Canberra as it continues to invest heavily in nuclear-powered defence capabilities.

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