The future of the European defense firm

The future European defense firm will be radically different, being determined by future threats, novel technology, and yet to come European defense policy. The immediate threat arises from the war in Ukraine, but longer-term European defense policy based on the Strategic Compass will provide the framework for the future European defense firm. Past developments offer some indication of the future and it is predicted that the defense firm has a future and will survive. The past trend of smaller numbers of larger defense firms will continue with firms being even more technologically-intensive—reflecting Augustine weapons systems, which are characterized by continuously rising unit costs and smaller volumes. There will be more mergers between European defense firms and more joint European projects developing and producing combat air and naval systems, tanks, and cyber systems.