Strategic options for the European defence industry in the 2020s

Tobias Mueller

Defense & Security Analysis, 2025, vol. 41, issue 1, 49-80

Abstract: In times of the “Zeitenwende” European defence industrial companies face several challenges simultaneously: high fragmentation of the industrial ecosystem and product portfolio, a historic focus on small-volume production of complex weapons systems, the need to expand capacity fast, diverging European national security strategies, Europeanisation of the security sector, and a dominant US defence industry, among others. This article analyses the most likely strategies for the European defence industrial companies as a response to this situation. The analysis is based on 18 semi-structured expert interviews with representatives of the European defence industry, academia, and politicians to identify and assess the strategic options. Porter’s Diamond framework is used to assess the impact of governmental influence, availability of production factors, historic chance, and structure of the value chain on the selection of strategies. The analysis focuses on pan-European industry consolidation, exports, self-funded R&D, internationalisation, co-operation with SMEs, and future large-scale defence co-operation programmes.

Date: 2025
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DOI: 10.1080/14751798.2024.2418163

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