Despite growing concerns over political uncertainty in Washington, defence industry cooperation between the U.S. and Europe continues, experts said at a recent CEPA press briefing.
During the 21 May event on revitalising the transatlantic defence industrial strategy, I asked panellists whether diminished trust in the U.S. administration is affecting short-term cooperation between major defence firms on both sides of the Atlantic.
Jason Israel, the Auterion Senior Fellow for the Defense Technology Initiative at CEPA and a former Special Assistant to the U.S. President for Defence Policy, responded: “There is a very strong ability for—and interest in—ties between the companies to continue even amidst this trust and diplomacy deficit.”
Drawing on his experience in the Biden administration, Israel said: “I make the case for a grand bargain where companies could really make enormous contracts, or at least MoUs that explore big contracts between companies, because the interests are there.”
He cited three key drivers: large-scale European defence funding commitments, the need to expand the U.S. industrial base, and the relative scale difference between Europe’s and America’s defence sectors. “The European defence and technology industrial base, as they call it—the EDTIB—is just smaller, and the SAFE fund and others allow for its growth. But it’ll take a decade to ramp up to the ability to supply that kind of level.”
Israel pointed to the ongoing push for export reform as another area requiring urgent attention: “We need to be able to be more flexible and move faster.” He referenced the April 9 executive orders from the previous administration, which shifted the focus of protection under the export control regime. “From now on, only the most critical and sensitive technologies will be protected. That still has to be interpreted in a certain way, but exactly how that’s going to be interpreted will be very telling.”
When asked how companies can navigate the uncertainty, Israel recommended pursuing joint ventures: “If I’m a U.S. defence firm, I’m certainly looking for partnerships I could have with European firms—not only for Ukraine, but to take advantage of these new EU funding vessels.”
He also touched on the UK’s position post-Brexit, noting new developments that may strengthen UK-EU cooperation. “The UK-EU deal that was signed just this week includes something—at least the UK announced—that paves the way for the UK to be part of it.”
On EU defence initiatives like the “rearm Europe” fund, Israel clarified: “Much of that could look protectionist, but it doesn’t actually say 100% of finished goods have to be from Europe. It works with different percentages—somewhere between 40 and 70—based on different timelines and types of equipment.”
Jan Kallberg, also a CEPA fellow, said Europe is increasingly aware it must take greater responsibility for its own defence posture. “There’s a sobering up in Europe… They realise they already have to take care of their own business.”
He argued that trust, regulatory simplification, and differing industrial strengths—digital dominance in the U.S. versus mechanical expertise in Europe—remain fundamental barriers. On cloud services, he added that American firms dominate: “Fifteen years ago a CIO controlled 90% of the data. Now, maybe 10%. The rest is with cloud providers—Microsoft, Google, AWS. That’s a challenge but also a direction we must pursue.”
Israel concluded that, while political rhetoric may be volatile, corporate engagement remains forward-looking: “The companies will keep driving forward. But if we want scale, speed, and shared sovereignty, we need trust—and contracts.”
The problem is there is no option but to buy US for a lot of kit right now. Eg need a stealthy attack jet and F35s your only option. It will take time to develop alternatives, it’s why our governments handling of Trump had been spot on, as much as I would love for us to tell him to go do one.
Hopefully we’ll have some good marketing people pushing Tempest, if they can make this thing work the stars might align to open up a healthy export market.
There will never be European alternatives. Europe is caught in a feedback loop of low defense spending to prop up the welfare state and poor cohesion from prioritizing national interests. The Continent can’t even articulate a unified position on the Ukraine invasion. It has a hollow puff of a defence industry and looks to remain so.
Germany and Southern Europe are utterly pathetic, and they love the benefits that provides.
Good to see you are looking on the bright side Chris.
Personally I think there are signs individual European Countries are beginning to loop at their capability gaps with an aim of plugging them. Europe does not do much strategic thinking at the European level. But this may well be beneficial as some countries tend to be better at certain things. I would expect the UK to do rather well in this environment and to suggest that the welfare state will hold us back is to say the least missing the point.
Although I agree we still need the US, I think I would be a bit more critical about what we get. As an example, I would put all further purchases of F35 on hold until they are able to fire British missiles, meanwhile upping the numbers of Typhoon. However, at the moment I think that we need to develop drones, ammunition production and artillery as our immediate priorities. I would also be puuting out feelers to France about nuclear options.
Title completly inverts what happened. It is the reduced trust by USA in Europe.
I guess if your boss stops paying you what you were promised, it is you that broke his trust…