Europe kicks off defence transformation amid boosting spending, production

One year after unveiling an ambitious plan to transform its defence capabilities, the European Union says its military buildup has moved beyond promises to tangible results.

In an analysis published by Defense News, the case is made that Europe is undergoing a structural shift in defence spending, industrial production and procurement, aimed at making the continent a stronger and more capable security partner rather than replacing the United States.

The analysis argues that scepticism voiced in the United States after the EU announced its defence investment agenda last year is being answered by concrete action rather than political commitments.

"When I last wrote in these pages, in 2025, we had a plan – Readiness 2030, a nearly one trillion-dollar roadmap to buy new weapons and technological equipment," the author writes in Defense News. "Today, we’re making that plan happen."

According to the analysis, European countries collectively spent 2.1% of their combined GDP on defence in 2025, surpassing NATO's long-standing benchmark. Several frontline member states, including Poland, Lithuania, Latvia and Estonia, are now moving toward defence spending equivalent to 5% of GDP.

The article also notes that 18 EU member states have already joined the bloc's new $200 billion defence financing program, with more than $6 billion already allocated to accelerate procurement, expand defence production and deliver capabilities required by both the EU and NATO.

Beyond higher military budgets, Defense News argues that Europe's approach to defence has fundamentally changed. The continent is expanding manufacturing capacity, opening new production facilities and attracting private investment into technologies such as drones, armoured vehicles, artificial intelligence and electronic warfare.

One example cited is the announcement at the NATO Summit that Lockheed Martin and Germany's Rheinmetall will produce ATACMS missiles at a newly opened facility in Germany—the first time the missile system will be manufactured outside the United States.

The analysis also highlights efforts to reduce fragmentation across Europe's defence market. Rather than maintaining 27 separate procurement systems, the EU is seeking to encourage joint purchasing and coordinated investment, providing greater certainty for defence manufacturers and enabling faster production.

According to DefenseNews, these reforms are intended to strengthen the transatlantic alliance rather than weaken it.

"Let me be clear - this buildup is not about replacing the United States. It’s about becoming a stronger, more capable ally and balanced partner in a security relationship that benefits both sides of the Atlantic and keeps deterrence credible."

The article notes that Europeans remain the largest customers of the U.S. defence industry, accounting for nearly 40% of American arms exports, while more than half of European defence procurement continues to come from U.S. suppliers. As European defence spending grows, the analysis argues, so do opportunities for American defence companies.

The war in Ukraine is presented as a key catalyst for the transformation. According to the analysis, the EU and its member states have mobilised more than $300 billion in support for Ukraine, making Europe the largest overall provider of assistance. A substantial share of military aid has been spent with U.S. defence firms through joint procurement and European-funded purchases.

The conflict has also reshaped thinking about military production.

Europe has become very good, European Defence Commissioner Andrius Kubilius recently argued, at producing “haute couture missiles”—highly sophisticated but expensive weapons. The next challenge, the analysis says, is combining that expertise with the ability to manufacture “good enough” systems, including drones and other rapidly deployable capabilities, at scale.

Summing up the lesson, the author invokes an English proverb: “don’t let perfect be the enemy of good.”

Looking ahead, the analysis notes that the EU is expected to present a new European Security Strategy later this year, outlining the next phase of its defence transformation.

"Stay tuned – we are just getting started."

By Sabina Mammadli