American Defense Contractors Left in the Cold as Europe Plans Major Increase in Defense Spending

Europe appears to be heeding President Trump’s repeated threats that it needs to boost its defense spending, but the plans might not bring new business for American defense contractors.The European Commission on Thursday unveiled a comprehensive $860 billion five-year plan to strengthen defense capabilities among member states. It comes months after North Atlantic Treaty Organization members agreed to raise defense related spending to five percent of GDP by 2035.The bloc’s defense readiness roadmap calls for a large boost in military spending among member states. Part of that plan is to also scale up production in the European defense market.The goal is to increase the amount of military purchases that come from European factories to fifty-five percent by 2030, Courthouse News Service reports.The commission is proposing four pillars to its defense plan: fortifying borders with Russia, a drone defense initiative, a European air shield, and a European space shield.The report warns that Europe has to build up its defenses to counter Russia, which has a defense budget that will surpass seven percent of its GDP in 2025. “This militarized Russia poses a persistent threat to European security for the foreseeable future,” the report warns. “The recent threats have shown that Europe is at risk. We have to protect every citizen and square centimeter of our territory,” the president of the European Commission, Ursula von der Leyen, said. “Today’s defense roadmap presents a clear plan with shared goals and concrete milestones on our path to 2030.”European defense budgets have nearly doubled in the past four years — from 218 billion euro in 2021 to an estimated 392 billion euro in 2025. But the report warns that increased spending must pay off in terms of jobs, innovation, and competitiveness in Europe. Right now less than half of defense equipment the bloc obtains is produced by member states, while non-European suppliers — mainly the United States — have gained in market share. The plan calls for a reversal of that trend.The plan also calls for more joint weapons procurement between the member states, including drones and missile defense systems. The goal is to double joint weapons purchases to forty percent by the end of 2027.The report warns there needs to be a massive program to reskill European workers to fill defense jobs. The plan calls for member states to retrain 600,000 people by 2030 with 200,000 workers retrained by the end of next year.The twenty-seven member governments of the European Union will meet next week to start the approval process for the proposals.

American Defense Contractors Left in the Cold as Europe Plans Major Increase in Defense Spending

American Defense Contractors Left in the Cold as Europe Plans Major Increase in Defense Spending

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