1 June 2026

 

For years, discussions about Europe’s competitiveness have concentrated on what the continent was losing. Manufacturing was heading elsewhere. The United States and China appeared to be consolidating their leadership in technology more and more. Defence capabilities were spread across national borders.

Today, a different story is starting to tell itself.

European companies are expanding factories, ramping up production, forming cross-border partnerships, and developing technologies designed to be built at scale across the defence sector. An increasing number of companies, from missile maker MBDA and German defence giant Rheinmetall to younger outfits like Helsing and Destinus, are positioning themselves as builders of European capability, not just as national champions.

Russia’s invasion of Ukraine, rising geopolitical tensions and a new focus on defence spending have all boosted demand for military equipment across Europe. At the same time, governments are increasingly focused on sovereign production, resilient supply chains and technologies that can be produced and sustained in Europe itself.

The result is an industry more confident in its role and more willing to talk about its ambitions in European terms.

 

From national programmes to European capability

 

Europe has never been short of engineering talent.

The continent still has some of the world’s most sophisticated aerospace, defence and industrial manufacturers. What has often proved more difficult is to translate that expertise into coordinated industrial capacity.

Defence production has been fragmented in the past. National governments retained procurement priorities. Manufacturing was scattered across various programmes and supply chains. Duplication was frequent.

That model is starting to change.

Modern defence projects often involve multiple countries, with shared industrial investment and production networks that cross borders. European defence firms are not losing their national identities but many are situating their work in a wider European context.

MBDA itself was founded on that idea. The missile maker draws on expertise and production facilities from France, Germany, Italy, Spain, and the United Kingdom. In recent years the company has been one of the most visible examples of how European industrial cooperation can compete on a global scale in a highly specialised sector.

 

Defence startups are changing the conversation

 

Established contractors have historically dominated major defence programmes. New companies today are helping to shape the conversations around autonomy, artificial intelligence, software-defined systems, and production models.

A particularly striking example is the German company Helsing. The firm has coalesced around artificial intelligence for defence applications and has become one of Europe’s most-watched defence tech companies.

Destinus has taken a different path.

It was founded in 2021 and first came to prominence with high-speed flight technologies before moving into long-range strike systems, autonomous defence technologies, and European defence manufacturing. While many aerospace start-ups continue to focus on prototypes and demonstrations, Destinus is increasingly positioning itself as a defence manufacturer focused on operational deployment and industrial production.

In April 2026, Destinus formed a joint venture with Rheinmetall called Rheinmetall Destinus Strike Systems, which is to develop next-generation missile systems. A month later, the company announced the accelerated development of RUTA Block 3, a long-range precision strike system being developed with Rheinmetall. Development, production, and testing activities will take place in several locations across Europe, including the Netherlands, Germany, and Ukraine, the JV partners said. 

 

Why defence manufacturing capacity matters again

 

The war in Ukraine has reinforced a lesson that goes far beyond defence.

Advanced technology is key. Production capacity is important, too.

Artillery shells, missiles, drones and interceptors of air defences have been deployed in quantities that have taken many Western observers by surprise. The experience has forced governments and makers alike to think differently about scale.

Rheinmetall is ramping up ammunition production and has invested heavily in new facilities with increased output across a number of sites. Just a few years ago, its goal of producing up to 1.5 million artillery shells annually by 2027 would have seemed extraordinary.

MBDA is also ramping up production of missiles and plans for billions of euros more investment in years to come.

These efforts are not just about refilling inventories.

This is an acceptance that industrial capacity is a strategic asset in its own right.

Factories, supply chains, engineering teams and manufacturing know-how are now central to Europe’s security calculations.

 

Building for contested environments

 

The technologies are also evolving.

Electronic warfare is a major factor on today’s battlefields. Communications links can be cut. Satellite navigation signals can be interfered with or spoofed. Systems that rely completely on external guidance run into more and more problems.

This reality is driving design decisions across the industry.

Companies are putting money into onboard processing, artificial intelligence, and navigation systems that enable platforms to operate in contested environments. Helsing has shown these capabilities in its autonomous systems. Destinus has also highlighted technologies that are meant for environments where satellite navigation cannot be trusted.

It’s not about all-out autonomy.

It is resilience instead.

The ability to operate in the presence of degraded communications has become an increasingly important requirement for modern defence systems.

That trend runs through drones, missile systems, reconnaissance platforms, and air defence technologies.

 

Europe is building more than weapons

 

Perhaps the most interesting aspect of Europe’s defence renaissance is not the systems themselves.

It is the industrial ecosystem that is taking shape around them.

The visible outputs are missiles, drones, sensors, and autonomous platforms. Behind them are engineering organisations, manufacturing facilities, software teams, test programmes and supply lines that span the continent.

One of Europe’s greatest strengths has always been its capacity to build together and the defence industry is rediscovering this.

From missile production to autonomous defence systems, from artificial intelligence to electronic warfare resilience and industrial-scale manufacturing, more and more companies are arguing that Europe’s future security will be as much about industrial capability as it is about technological innovation.

 

Further reading on MoveTheNeedle.news:

Sublime Energie takes biogas off-grid to unlock Europe’s stranded biomethane potential

Schwarz Digits launches ES³ to set European standard for digital sovereignty

Shield AI and the rise of autonomous warfare: from software to airpower