De Tijd on challenges of ramping up defence production

An article this week in Belgian newspaper De Tijd looked at the challenges in expanding arms production in Europe, despite increased demand following the Russian invasion of Ukraine. While policymakers agree on the necessity of strengthening Europe's defence capabilities, there are significant obstacles. The article emphasises that achieving a robust and self-sufficient European defence industry will require significant financial commitments, harmonisation of military procurement across the continent, and enhanced transatlantic cooperation to overcome these barriers.

The article includes the following key quotes from ASD:

"Since defence has risen on the priority ladder after the Russian invasion of Ukraine, everyone suddenly expects us to press a button and switch into rapid production mode," says the Aerospace, Security and Defence Industries Association of Europe (ASD), which represents more than 4,000 companies in the European aerospace, security and defence industry. 'But of course it's not that simple, after three decades of underinvestment in the sector.'”

“’The demand for certain equipment was so low that companies deliberately spread the processing of orders well over time to ensure that the production line continued to run. If they had carried out the orders at a normal pace, such a line would have come to a standstill after a few years, with all the consequences that entails,’ sources at the ASD outline the strategy that many European defence companies applied in the period between the end of the Cold War and the beginning of the war in Ukraine.”

"’The industry has done its best to meet these demands by increasing its production capacity as much as possible - in difficult circumstances,’ ASD says.”

“’SMEs also have a key role to play throughout the supply chain. They usually supply the components that multinationals need to assemble their final product. But several of them are struggling because they are struggling to access funding sources. The consequences of this can trickle down to the big players. Without SMEs, the European defence industry simply cannot function,’ says the ASD.”

“’The Ukrainians received battle tanks from various European countries. But because they each have their own specifications, one training course was not enough to enable them to serve them all. Moreover, it turned out that a French artillery shell could not be fired with a German system,’ says Frank Haun, the CEO of Leopard manufacturer KNDS, outlining the implications of this fragmentation. According to him, it would be only logical for European countries to play the armonization card because their armed forces often work together. ‘Yet every country, to this day, continues to order Leopards with its own sensors, radios and navigation systems. National selfishness is so great that it stands in the way of more cooperation and the joint implementation of projects,’ Haun said recently at the European Defence & Security Summit in Brussels.”

“At the ASD, they are convinced that the objectives are achievable, even though defence remains a national competence until further notice. 'Yes, the member states make the decisions about military investments. But Europe does have a toolbox to encourage more cooperation. In the next long-term budget (from 2028, ed.) By earmarking 100 to 150 billion euros for defence, it can really push the sector forward. Industry and the public sector must share the risks.'”

“There is still some low-hanging fruit to be picked on the road to greater scale, according to [ASD]. 'Sometimes the same weaponry is made in slightly modified national variants. These differences are often easy to eliminate without substantially changing the operation of the weapon or leading to job losses. It is often a matter of political will to pursue that harmonization in Europe.'”