Sweden is a country with few tall buildings. There are none in central Stockholm and few in other cities. Malmo in the south is a slight exception to the general pattern. Today the main feature of the skyline is the new 54-storey ‘Turning Torso’ building, built on the old shipyard, but for the previous 25 years the city was dominated by the huge gantry crane and the 11-storey headquarters of its largest employer, Kockums. It was in this solid, cylindrical building overlooking the increasingly derelict shipyard that Australia's new submarine was designed.

Traditionally Sweden's submarine force was made up of several classes, with each class being an evolution from the previous class rather than a completely new design. Kockums' designers did not sit down with a blank sheet of paper, but rather had an evolving submarine design that they were always testing and modifying.

The process of designing the new Australian submarine began even before the navy's operational requirements were released. Olle Holmdahl, Kockums' head of systems engineering in the late 1970s, recalls that when Kockums' designers first heard of a possible submarine project in Australia they pooled their experience and knowledge of Australia's Oberon operations, and then put together a design to meet the anticipated requirement. The emphasis was on long range and endurance, with the battery size paramount. Roger Sprimont and Olle Holmdahl discussed this conceptual design with an Australian navy team led by Bill Rourke as early as December 1981.