The Chinese Navy has apparently resumed building more of its version of the Russian Kilo class diesel-electric subs. Construction appeared have halted in in 2013. Then at the end of 2016 three more of these Yuan class (Type 39B/41) subs were seen under construction. The last new Type 41 appeared in late 2013 but even before that there were indications that this was another pause to absorb user experience with the current model and plan modifications for the next batch. This is apparently the three new ones detected. When these enter service China will have twelve Type 41s, plus three of the earlier Type 39A versions. The three latest 41s have many modifications and upgrades, some of them visible because of minor changes in the conning tower or hull features. China is apparently upgrading its sensor and fire control electronics but the capabilities of these won’t be detected until foreign subs encounter the new 41s at sea. At that point U.S. subs will be able to construct an acoustic and electronic “signature” of the new 41s so they can be more easily and quickly identified in the future.

One thing is certain about the latest Type 41s; the Chinese are continuing their relentless effort to create world class subs, one tweak and improvement at a time. Since the late 1980s China has been designing and building a rapidly evolving collection of "Song" (Type 39) class diesel-electric submarines that emphasize quietness and incremental improvements. The changes have been so great that the four Songs completed in 2013 were recognized as a new type and designated the Yuan class (Type 39A or Type 41). The original design (Type 39) was a 1,800 ton Kilo type sub that first appeared in the late 1990s and 13 have been built. The larger (2,800 ton) Type 39A first appeared in 2006. The Type 39A quickly involved into the larger and more lavishly equipped Type 39B showed up. The evolution continues, and there are now thirteen "Type 41 Yuan Class" subs (of at least three, now four distinct models). These latest models appear to have AIP (air independent propulsion system) along with new electronics and other internal improvements.

This rapid evolution of the Type 39 appears to be another example of China adapting Russian submarine technology to Chinese design ideas and new technology. China has been doing this for as long as it has been building subs (since the 1960s). But the recent versions of the Type 41 design shows Chinese naval engineers getting more creative. The Yuans were meant to have an AIP that would allow them to cruise underwater longer. Western AIP systems allow subs to stay under water for two weeks or more. The first Chinese AIP had less power and reliability and does not appear to be nearly as capable as Russian or Western models. In part this was because that AIP used lead-acid batteries. The Chinese kept improving on their AIP, and the last half dozen AIP systems were designed to use a more efficient lithium battery system. This AIP 2.0 has numerous other tweaks and appears, on paper at least, to match what most Western AIPs can do. .

The Songs look a lot like the Russian Kilo class and that was apparently no accident. The 39s and 41s are both similar in appearance but the type 41s appear larger than the 1,800 ton Type 39s. Both have with crews of 60-70 sailors and six torpedo tubes. This is very similar to the Kilos (which are a bit larger). China began ordering Russian Kilo class subs, then one of the latest diesel-electric designs available, in the late 1990s. The first two Type 41s appeared to be a copy of the early model Kilo (the model 877), while the second pair of Type 41s appeared to copy the late Kilos (model 636). The latest Yuans still appear like Kilos but may be part of an evolution into a sub that is similar to the Russian successor to the Kilo, the Lada. The Type 39s were the first Chinese subs to have the teardrop shaped hull. The Type 41 was thought to be just an improved Song but on closer examination, especially by the Russians, it looked like a clone of the Kilos. The Russians now believe that the entire Song/Yuan project is part of a long-range plan to successfully copy the Kilo. If that is the case, it appears to be succeeding.

China currently has 13 Song class, 12 Kilo class, 15 Type 39A/B (Yuan) class, and 18 Ming (improved Russian Romeo) class boats. But at least a dozen more Yuans are apparently planned. There are only 3 Han class SSNs, as the Chinese are still having a lot of problems with nuclear power in subs. Despite that, the Hans are going to sea, even though they are noisy and easily detected by Western sensors. Five Hans were built (between 1974 and 1991) but 2 have already been retired. There are 4 newer Shang class SSNs in service, but these are still pretty noisy. The Song/Yuan class subs are meant to replace the elderly Mings.

China is also offering their “improved Kilo” designs to export customers. In late 2016 China confirmed that final details have been agreed to on the sale of eight Chinese S20 diesel-electric submarines to Pakistan. These are export versions of the Type 41 that lack many of the advanced features. Four of these will be built in China while at the same time Chinese personnel will assist Pakistan in building another four in Pakistan. Final cost is expected to average somewhere between $500 million and $600 million each and the first one will enter service by 2023. Since early 2014 China and Pakistan have been negotiating prices and terms for the sale of the S20. At first it was believed that Pakistan wanted six subs, but the final deal specified eight. Currently the Pakistani Navy has five submarines and plans to use all of them against India (which is also considered a Chinese foe).