Josselin Droff, Lucie Béraud-Sudreau, Eva Szego and Julien Malizard have published the article Redefining the defence industry: an empirical analysis of new defence firms in Europe in the academic journal Defence and Peace Economics
Against a backdrop of European rearmament, a war of attrition in Ukraine and rapid technological advancement, this article analyses how new industrial players are helping to reshape the European defence industrial and technological base. The authors focus in particular on the phenomenon of ‘New Defence’, understood as the emergence of new products, new business models and new entrants in sectors such as drones, ground-based robotics, autonomous naval systems, small satellites, launch vehicles and stratospheric platforms.
The article has two main objectives. The first is to propose an operational definition of ‘New Defence’ companies, distinguishing them from traditional defence industry players. The second is to produce an initial empirical analysis at European level, based on a sample of 317 companies spread across six markets representative of new forms of conflict: tactical drones, small drones, autonomous ground systems, naval drones, small satellites and launch vehicles, HAPS and airships.
Several findings emerge from the analysis. Firstly, *New Defence* significantly broadens the scope of the European defence industry: by combining the segments studied, the inclusion of new entrants increases the number of identified players by a factor of 3.3 on average. This trend is particularly pronounced in the sectors of small satellites and launch vehicles, small drones, naval drones and stratospheric platforms.
Furthermore, the «New Defence» cannot be reduced to a simple dichotomy between innovative start-ups and long-established large corporations. The article shows that the ecosystem is more diverse: it includes start-ups, but also established SMEs that are repositioning themselves in new markets, as well as long-established players that are integrating these technologies through partnerships, acquisitions or in-house development. The authors thus highlight the potential role of certain SMEs in the emergence of future European ‘neo-prime’ players.
Third finding: new entrants are, on average, younger, smaller and more reliant on private funding than established firms. New defence markets also appear to be more competitive than traditional defence markets. Nevertheless, the overall market remains heavily dominated by the major established prime contractors, particularly in terms of employment and industrial capacity.
Finally, the article highlights several industrial policy challenges. The development of ‘New Defence’ presents an opportunity for European strategic autonomy, but it also raises risks: acquisitions by non-European players, fragmentation of national markets, difficulties in scaling up to industrial levels, and the possible inadequacy of traditional public procurement instruments. The authors therefore call for an industrial policy capable of supporting start-ups, innovative SMEs, established SMEs undergoing repositioning and large conglomerates alike, in order to prevent Europe’s new technological capabilities from being captured or dispersed.
This publication builds on several recent studies by the Chair focusing on the transformations taking place in the European defence industry and the new balance between innovation, production, strategic autonomy and industrial policy.
For further reading, see also:
- «New Defence» and defence industrial policy in Europe
- Establishment of new defence companies in Europe
- [VIDEO] Defence procurement markets: new requirements, new industrial players, new strategies?
- ECODEF Bulletin #4 – The Re-armament of Europe
- The Chair’s participation in the ASSA 2026 conference in Philadelphia
- All publications from the Chair
