European Defense Contractors Want Guarantees of Endless War to Expand Production

“Before, we had time, but no money,” said Tommy Gustafsson-Rask, head of BAE Systems Hägglunds AB, reflecting a common theme across Europe’s defense industry. “Today, we have money, but no time.”

Almost 18 months into the war in Ukraine, Europe’s defense contractors — flooded with demand for everything from ammunition to shoulder-launched missiles and combat vehicles — face a dilemma. Do they gamble on expanding production, assuming that the war and tensions with Russia will last indefinitely? Or hold back until they get long-term commitments from governments that have spent the past few decades shaving or even slashing their defense budgets?

The calculation matters beyond the corporate offices of Europe’s defense industry, which collectively generates about $130 billion a year in revenues. Ukraine urgently needs more weapons, from artillery ammunition to air defense systems, and allies’ stocks are running low. European capitals are trying to revive their own sleepy industries to both sustain weapons deliveries to Kyiv and bolster their own security. [But e]ven as orders start to pile in, the fear in the industry is that it could expand production only to find that when new facilities open in three or five years’ time, there is no demand. . .

“We want to see the words followed by action — real action,” said [the chairman of business association ASD Europe’s defense unit]. (Read more from “European Defense Contractors Want Guarantees of Endless War to Expand Production” HERE)

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