US defence companies are wooing European rivals, targeting closer partnerships, as they seek to ensure they are not locked out of the region’s military spending spree.
Executives at some of America’s biggest defence groups were at pains to underline their long-standing transatlantic ties at the Paris air show last week, while also promising to help European countries build up their sovereign capabilities.
“We are an American company but we are also a global company,” said Bernd Peters, vice-president of business development and strategy at Boeing’s defence arm.
The message to Boeing’s partners in Europe “as they think through their own sovereign capability . . .[is that] we are right there with them to help them develop that”, he said at the show.
Anduril, the US defence tech group, signalled a similar approach after unveiling a new partnership to develop drones for Europe with Germany’s Rheinmetall.
More US groups are eyeing joint development and local production opportunities, and Anduril said the alliance reflected a “built with, not built for” philosophy — “one that prioritises local control, transparency and adaptability over dependency or lock-in”.
Europe’s higher defence spending — triggered by the war in Ukraine and pressure from US President Donald Trump to contribute more to the region’s own security — was an opportunity US companies did not want to lose out on, said industry analysts.
While the US offers growth, Europe was where the opportunity was, especially as investors ask “what’s your growth rate, where are you finding new business”, said Byron Callan, managing partner of research group Capital Alpha Partners.
America’s leading defence contractors have long-standing ties in Europe which represent a significant share of their annual revenues and they were hoping deeper partnerships would ensure they could still do business on the continent, according to industry experts at the show.
The region accounted for about 11 per cent of both Lockheed Martin’s and RTX’s annual revenues in 2024. Multiple European militaries have Lockheed’s F-35 fighter jet, while RTX’s Patriot missile was by far the market leader in terms of air defence.
Lockheed and Raytheon, the defence subsidiary of RTX, have in the past two years announced far-reaching co-production partnerships on the continent. Lockheed would establish large-scale missile production with Rheinmetall, while a joint venture between Raytheon and European missile maker MBDA would produce Patriot missiles for Nato in Germany.
Thomas Laliberty, president of land and air defence systems at Raytheon, said countries were taking “different approaches at what they mean by sovereignty”.
Raytheon, he added, tried its best to “understand each one of them . . . and to the extent that we can . . . help them meet those requirements”.
Frank St John, chief operating officer at Lockheed Martin, told the Financial Times in Paris the company was expanding not only its supply chain in Europe, but also establishing manufacturing.
The company’s partnerships would “serve us well as Europe looks to buy more within Europe because we will be a partner with European countries, companies in European countries”, he said.
Lockheed, he added, was making sure the partnerships would be eligible for the region’s funding and able to meet European requirements.
Boeing said it was “studying what collaborative opportunities would be available”. Peters said the company was keen to replicate in Europe the co-development approach it took with Australia to develop an uncrewed combat aircraft, the MQ-28 Ghost Bat.
However, the US contractors also needed to navigate questions about whether America, under Trump, was a reliable ally, which has prompted calls from within the region to wean itself off US weapons.
Concerns — denied by the Pentagon — that the US could immobilise key weapon systems remotely such as the advanced F-35 fighter jet, have heightened calls for European nations to reduce their reliance on imported weapons.
One particular concern among European defence executives was that companies could in future encounter problems exporting new equipment or securing a software upgrade.
A weapon that was subject to America’s International Traffic in Arms Regulations or Itar rules, cannot be built, sold or supplied to someone else without US consent and support. While the restrictions are not new, executives said questions over the reliability of Washington as a partner had sparked debate among some of its allies.
Éric Béranger, chief executive of MBDA, said while the company valued co-operation with US partners, it was a matter for governments whether they “want to be under the Damoclean sword of being Itar or not”. There are “various attitudes” among nations, he added.
Roberto Cingolani, chief executive of Italy-based Leonardo, said it was important to ensure the interoperability of weapons under the umbrella of the Nato security alliance.
Leonardo is part of a consortium with Britain’s BAE Systems and Japan’s Mitsubishi Heavy Industries developing a next-generation fighter jet and some analysts have questioned whether the project would deliberately try to remain free of US components or “Itar free”.
“I’m . . . very neutral,” Cingolani told the FT. “Whatever we will do with our colleagues and with the Americans under the Nato umbrella, it has to be established in a very clear way.”
For weapons to be interoperable between allied nations, he said, it was important to make sure individual countries had the ability to modify or upgrade the necessary software or components if needed.
US industry executives noted Washington’s recent moves to reform the country’s “foreign military sales” process used to deliver arms to international partners should make it easier for defence companies to do business abroad.
European executives stressed the continent had the capabilities to defend itself but conceded it would take time. Even with more funding, the region still needed to reduce the fragmentation of its arms industry.
“We have the brains, we do have industrial tools, we do have people, we even have the money,” Beranger said. “It is simply the matter of political willingness and the way we structure ourselves but we have the capabilities to be as sovereign as we want.”
