Poor range and speed were not the T2's only problems. Both of its exploders were terribly flawed. The magnetic influence mechanism, designed to allow the torpedo to run under the keel of a ship and detonate, breaking the ship's back, was totally inconsistent; often a T2 would detonate prematurely, or not at all. This lead the BdU to order all G7e/T2 torpedoes be fired only for contact detonation. However, the contact pistol of the T2 often did not work, either. The depth-keeping equipment of the T2 often failed as well, leading T2s to miss their targets by running too deeply under a target. Estimates of the failure rate of T2 torpedoes for one reason or another range between 20% and 40%.
Nevertheless, the German Navy, after much prodding by German U-boat Command (BdU), poured resources into correcting the T2's flaws. Gradually, it improved, and by the end of the Norwegian Campaign problems with the contact exploder and depth-keeping gear had been solved, as well as significant strides made in improving the magnetic proximity feature. At the same time, the T2's range was increased from 3000 m to 5000 m and eventually 7500 m. By that time, however, the T2 was already being phased out of production.
The T3 had a range of 5000 m and could achieve 30 kt (about fifty percent slower than standard British and American torpedoes). With the improved design of the T3 and the new exploder, the G7a steam torpedo was totally superseded and rarely used for the remainder of the war. Using the T3's perfected proximity feature, U-boat captains could effectively fire under the keel of a ship and break the back of their targets with a single torpedo, increasing the overall effectiveness of the U-boat fleet. The T3 could be fitted with both the FaT (Flächenabsuchender Torpedo) and LuT (Lagenunabhänger Torpedo) pattern running systems for convoy attacks.
Though many opportunities had been missed due to the defects of the T2 torpedo, with the new T3 U-boats were deadlier than ever.
The T4 Model was the adjunct of the earlier T3 model in nearly every way. However, this was no ordinary straight running torpedo, but the world's first acoustic homing torpedo. It ran at 20 kt (37 km/h) for 7500 m and was introduced in March 1943.
In early 1933, Germany started development and testing of acoustic homing mechanisms for torpedoes. From the outset of submarine warfare, it had been a dream to be able to aim and fire torpedoes without the aid of a periscope. because the periscope gives away the location of a submarine, and because a hull-penetrating periscope greatly weakens a submarine's pressure hull and limits the depths to which it can dive. U-boats also had to come to very shallow depths to use their periscopes, generally about 15 m, leaving them greatly exposed to bombing, depth charging, and even gunfire.
With the introduction of Falke, U-boats could remain more deeply submerged and fire at convoys with nothing to give away their position but the noise of their screws. Rather than aiming with a periscope, the torpedo could be roughly aimed at a sound contact as detected by a U-boat's hydrophones, and the homing mechanism could be trusted to find the target without the need for precise aiming.
Falke worked much like a normal straight running torpedo for the first 400 m of its run, whence its acoustic sensors became active and searched for a target. The sensitive sound sensing equipment in Falke required the torpedo be as quiet as possible, hence it ran at only 20 kt (37 km/h); in addition, the firing U-boat was forced to stop its motors. Falke was intended to home on merchant targets, however, so Falke's slow speed was not a great hindrance.
Only known to have been fired in action by three U-boats, U-603, U-758, and U-221; regarded as successful, resulting in the sinking of several merchants; and its performance satisfactory, Falke was rapidly phased out of service. It was replaced by the G7es/T5 "Zaunkönig" (referred to by the Allies as GNAT, for German Naval Acoustical Torpedo), which was faster and better able to home onto the sound of fast moving warships as well as merchant traffic.
Though its period of operational service was brief, Falke was a proof of concept for the acoustic homing torpedo. Its introduction occurred only two months before the U.S. Navy achieved its initial combat success with the Mark-24 FIDO "mine." FIDO was not a mine, but a passive, acoustic-homing torpedo designed for use by long-range patrol aircraft. (It was designated a mine for security reasons.) The initial success with the Mark-24 occurred on 14 May 1943, when a PBY-5 from VP-84 sank U-640 with the new weapon. "Falke" was quickly withdrawn and replaced with the G7s/T5 Zaunkönig torpedo, whose greater speed provided the capability to target Allied escort vessels as well as merchantmen. Most sources indicate that the Germans' first combat success with the Zaunkönig (known to the Allies as the German Acoustic Naval Torpedo or GNAT) did not occur until September 1943. While the Allies became aware in September 1943 that the Germans had brought GNAT into operational service, it was not until the capture of U-505 in June 1944 that they obtained reliable data on the German homing torpedo.