Adelaide is on the cusp of something big. The multi-billion-dollar AUKUS submarine program – Australia’s largest and most complex defence project – isn’t just about building nuclear submarines. It’s an opportunity to foster a culture of continuous improvement, deliver systematic-wide innovation and build the future of Adelaide’s economy for generations to come.
While the Pentagon is undertaking a review of the alliance, recent reassurance by Penny Wong that the strategic importance of the AUKUS agreement is “well understood” by the Trump Administration, is a positive indication that the agreement is on track. With 9,000 jobs expected in shipbuilding and supporting infrastructure, Adelaide has a once-in-a-generation chance to reposition itself as a national innovation hub – but this will only be realised if we approach the AUKUS opportunity beyond just the defence sector.
Many of the workers needed for the AUKUS program will be based at either the Osborne Shipbuilding Yard, the Edinburgh Defence Precinct, in the CBD or within existing innovation precincts, including Technology Park and Lot Fourteen. This convergence of world-class defence skills and expertise in Adelaide provides significant opportunity to expose local workers and neighbouring industries to cutting-edge technology, research and innovation.
Global experience shows this potential can be optimised to spark a wide range of commercial, productivity and local supply-chain benefits for the whole economy, not just for the defence sector. This requires continued collaboration with SMEs to grow and enter AUKUS supply chains and the evolution of defence procurement policy to deliver a more capable, innovative, resilient and competitive sovereign defence industrial base.
As highlighted in the 2025 Benchmarking Adelaide report, other international cities have shown us what’s possible with deliberate and persistent collaboration to diversify the technology base of a wider ecosystem.
Forty years ago, San Diego was little more than a Navy town. Today it’s a $40 billion defence-tech economy that has spawned more than 2,000 companies and employs more than 350,000 people. It achieved this by nurturing a startup culture with venture capital, building strong university-industry ties and establishing institutions like CONNECT and the SoCal Tech Bridge to support dual-use technologies and overcome struct procurement regulations and long development cycles.
CONNECT acts as a matchmaker which links engineers, scientists, students, civic leaders, entrepreneurs and angel investors. It was designed to be broad-based, multi-sector and bottom-up with dedicated leadership and champions. Beginning with about A$300,000 in today’s money, contributed by 30 supporters, the platform ran “how to” sessions, business workshops and startup roundtables to share issues and opportunities with peers and experts. Today, many of San Diego’s most successful companies owe their early momentum to the program, breeding more venture capital and a collaborative innovation community.
Likewise, the SoCal tech Bridge unites Navy and Marine Corps units, research institutions, SMEs, and emergency services, providing direct funding and testing opportunities for defence-adjacent startups. SMEs have better access to procurement channels and government contracts, strengthening local supply chains and giving rise to new commercial applications in autonomous systems, energy solutions, and healthcare. Special agreements (known as OTAs) give startups and SMEs a route to secure contracts without a long procurement process and helping remove barriers to enterprise innovation. San Diego also benefits from a major research centre (NIWC) that is in continuous collaboration with industry on issues around information warfare, cybersecurity, AI, and unmanned systems.
Toulouse in southwest France is another example. Perhaps best known for its aerospace cluster anchored by Airbus and 130,000 students enrolled annually in engineering universities, Toulouse has also successfully shifted into a set of SME driven specialisations such as satellite technology, avionics, software, medical devices, data analytics and new mobility. They did this through ‘Aerospace Valley,’ founded 20 years ago to coordinate joint R&D, gaining 850 members, the majority of which were small firms, as well as universities and research institutions. The organisation supports accelerated tender processes, and dual-use spin offs such as drone and satellite data startups now working on agriculture (precision farming), climate monitoring, and disaster relief. Venture funding for aerospace and defence startups in Toulouse has tripled in the past decade, and 1,500 firms are now in the cluster
As the home of AUKUS, Adelaide can do the same. We already have the right ingredients: shipbuilding capability, research institutions, and emerging innovation precincts at Lot Fourteen, Edinburgh and Technology Park. But we need to connect the dots, quickly and with purpose.
That means making it easier for SMEs to break into defence supply chains. We need policy and procurement systems that reward innovation, not just size or incumbency.
We need better pathways from research to commercialisation—supported by mentoring, advisory networks and venture funding. We must also ensure our digital and physical infrastructure is world-class and ready for rapid prototyping. And San Diego didn’t just build submarines—it built a brand as a high-tech, high-talent, high-opportunity city. We need to do the same and promote Adelaide’s business and innovation ecosystem on the world stage —not just as a defence hub, but as a place where global ideas are born, tested and exported.
If we treat AUKUS as just another defence contract, we’ll miss the multiplier effects. But if we treat it as a catalyst for an innovation-driven economy, Adelaide will grow not just a defence sector but a profitable, sustainable and innovative ecosystem for all to enjoy.
Sam Dighton, Chief Executive, Committee for Adelaide
