The former Lithuanian prime minister Andrius Kubilius was speaking to a room packed with the leaders of Europe’s biggest defence companies and arms manufacturers.
Most of those in the audience were no doubt keen to get in front of the 68-year-old politician, who several months beforehand had become the first European commissioner for defence policy.
Working under European Commission president Ursula von der Leyen, the veteran Lithuanian politician has been tasked with helping Europe rapidly shore up its defences in light of the threat posed by Russia.
“We need you to ramp up production on a scale that will deter [Vladimir] Putin ... We cannot expect that Putin will postpone his plans for aggression until we will be ready to defend ourselves,” Kubilius told the defence executives at the industry conference in London in May.
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EU states have committed to spend hundreds of billions of euro more on their defence over the coming years to rearm militaries sagging from under-investment, keep pace with the changing nature of cyber and drone warfare and wean themselves off a dependence on the United States to guarantee their security.
That means huge sums of money will flow into the defence industry over the next five years.
Documents obtained by The Irish Times showed many of Europe’s top defence and military manufacturers have not been shy in letting Kubilius know how they think it should be spent.
Italian defence firm Leonardo, French multinational Thales, missile-manufacturer MBDA, Europe’s naval shipbuilders, as well as giants in the US defence industry such as Lockheed Martin, have sought to influence the EU’s plans to massively increase military spending.
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The European Commission, the EU’s executive arm that proposes laws, has traditionally played a very minor role when it comes to defence policy. That has always been left to national governments. Where there is co-operation between countries it mostly happens between Nato members within the framework of the military alliance.
Russia’s full-scale invasion of Ukraine in early 2022 changed things. EU channels have become much more important in providing military and financial support to Kyiv, as well as levelling economic sanctions on Moscow.
Von der Leyen promised that in her second term she would appoint a standalone EU commissioner for defence.
Allocating different portfolios to each of the 26 commissioners is always a delicate political balance.
Late last year, von der Leyen privately joked to people that every national government wanted their commission nominee to bag a strong economic portfolio, or the defence job in the case of those in central and eastern Europe.
Lithuania’s nominee Kubilius was ultimately picked. A former leader of the Baltic state, he does not underestimate the threat Putin poses beyond Ukraine to EU states in the east.
For those in the arms or defence industry, suddenly the Lithuanian politician became the guy to get to know.
Leonardo, one of Europe’s biggest defence firms, called for a “big bang” of extra funding to pump into the sector, in an internal submission to the commission on its defence plans.
The Rome-headquartered company said at least €100 billion should be ring-fenced for direct investment in defence in the EU’s next seven-year budget.
“We believe this to be the bare minimum for starting to rebuild our military and industrial capacities; and if we consider our past complacency after the end of the Cold War, more would surely be needed beyond this baseline,” the submission said.
The company, which specialises in helicopters and jets, said extra financial “firepower” would not be enough on its own. The EU should help build up some companies into “European industrial champions”.
If producers had long-term commitments from governments to buy equipment, factories would have greater capacity to “rapidly scale up production in times of crisis,” Leonardo told the defence commissioner.
Denis Goge, chief executive of US missile and fighter jet giant Lockheed Martin’s Europe operation, caught Kubilius shortly after he started the job, at an event in the European Parliament last December.
In a January 6th letter afterwards, Goge said he looked forward to continuing their conversation and finding “opportunities to further strengthen the European and Transatlantic defence industrial & technology base”.
Correspondence between firms in the defence industry and the commission were released to The Irish Times, following an EU access-to-information request.
Eric Béranger, chief executive of missile producer MBDA, said new defence plans should expand Europe’s “long range strike capability”, given the important role long range missiles played in contemporary conflicts.
French president Emmanuel Macron shares the view that anti-drone defences alone will not deter Russia.
In a submission to the commissioner, MBDA said national governments still had to keep their “central role” in setting defence policy. The arms producer, which has large manufacturing bases in France, the UK, Italy and Germany, said Europe also had to develop defences capable of taking down incoming hypersonic missiles, such as those Russia has deployed in Ukraine.
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EU states should be pushed to buy weapons and kit from the European defence industry, MBDA said. “EU taxpayer money must create added value on EU territory.”
Joint borrowing as a 27-state bloc to finance defence spending should be considered, the company said.
Taking on common debt to fund spending has consistently been opposed by the Dutch government and other fiscally frugal northern states.
Instead, the commission has lifted spending rules meant to keep national budget deficits in check if the extra money is put towards defence.
The Berlaymont has extended €150 billion in loans to member states to finance investments in defence. Two thirds of the money has to be spent in the EU, or in Ukraine, as part of the deal.
States along the eastern flank, where the Russian threat feels much closer, have claimed about €100 billion of those cheap EU loans.
The rush to spend more on security has taken on fresh urgency given the growing sense the US cannot be relied upon as a military ally while Donald Trump is in the White House.
Spending had already been rising significantly since Russia’s invasion of Ukraine. The combined amount the 27 EU states allocated to their own defence budgets has shot up from €218 billion in 2021 to nearly €400 billion this year.
It is not just the union’s eastern border that is at risk, companies told the commission.
SEA Naval, which represents eight big shipyards in Europe, said events in the Red Sea and Baltic Sea illustrated “how the boundaries between conventional and hybrid warfare have virtually disappeared”. The industry group said protecting critical subsea infrastructure should be a “key priority”, in a December 12th, 2024 letter.
In another letter to Kubilius, French defence firm Thales said Europe was facing a “pivotal” moment. Chief executive Patrice Caine argued for a “European preference”, to make sure extra money being invested in defence was spent in Europe rather than the US.
The firm, which has a UK arm that includes a missile factory in Belfast, said it wanted to work with the commission to “collectively meet the demands of tomorrow’s security landscape”.
Heckler & Koch, a major German firearms manufacturer, warned about national “egos” getting in the way of the EU’s ambition to step up the continent’s defences.
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Countries and manufacturers were resistant to changing their way of doing things, or giving up control, the arms producer told Kubilius in a November 2024 letter.
Standardising weapon systems would make it easier for different European military forces to work together, something that was vital to pose a “credible deterrence” to any attack, the letter said.
Those national egos are in full view in an ongoing dispute between France and Germany over a joint project to develop a next generation fighter jet, along with Spain. Tensions between French and German firms over the ownership of the project have threatened to derail it entirely.
The commission has bet a lot of chips on the union being able to pull together and fund several big defence projects.
They include an air defence shield modelled on Israel’s Iron Dome to shoot down missile attacks, and a “drone wall” that could detect, jam or shoot down enemy drones crossing into EU territory.
In a “roadmap” announced this week, the commission said it hoped the drone wall would be operational by the end of 2027. Ukraine will relay what it has learned from years of fending off Russian drone attacks. The EU executive’s proposal warned the heavily militarised Russian state posed “a persistent threat to European security for the foreseeable future”, with those to the east facing the “greatest direct threat”.
One commission source said if each EU state tried to build up defences on their own, governments would bid against each other when placing orders for equipment or hardware. Instead, states will be encouraged to club together and order in bulk, as well as forming coalitions to address certain gaps in Europe’s defences.
Flagship projects, such as the air defence shield and drone wall, will need to be jointly funded, likely putting pressure on already stretched domestic budgets.
National leaders are to debate the plans at an EU summit in Brussels next week.
A recent summit of leaders in Copenhagen reasserted that capitals should be the drivers of defence policy, not the commission, according to several sources briefed on the private discussions.
Governments are always reluctant about ceding more power to officials in Brussels, so managing that point of tension, plus those big national egos, will be crucial to avoid joint projects becoming bogged down by internal bickering.
Speaking on Thursday, Kubilius said the EU’s plan would deliver a “real big bang” on defence and the price of failing to follow through could be “very painful” for Europe.
