Europe stands at a strategic crossroads. A continent long reliant on its transatlantic ally for security hardware may finally be confronting an uncomfortable truth: major geopolitical shifts demand a robust, autonomous defence industrial base.

This week in Brussels, France’s Minister for Space, Philippe Baptiste, made precisely that point when he urged the European Union to adopt a “Buy European Act” to ensure the bloc exclusively purchases European components for defence and space systems. It is a call that resonates beyond rhetoric and strikes at the heart of Europe’s future strategic independence.

Ultimately, the success of such an initiative hinges on whether Europe can marshal its industrial might — from the continental giants of aerospace to the innovation-driven end of the supply chain — to create capabilities that rival those of the United States. There are already strong performers on the continent and in the UK that suggest Europe has the raw materials for such an ambition.

Britain’s BAE Systems plc unquestionably leads this charge. As Europe’s largest defence contractor, BAE Systems boasts an enviable portfolio across land, sea and air domains and a record order book valued at nearly £78 billion — a figure that provides crucial revenue visibility for years to come. The company’s involvement in marquee programmes such as the Eurofighter Typhoon and the Global Combat Air Programme, alongside its work on submarines, artillery and electronic warfare systems, demonstrates how integrated UK capability remains central to European defence planning.

Across the Channel, continental names are powering their own success. Airbus SE has seen particular strength in its space and helicopter divisions, exemplified by a near 20 per cent rise in orders for Airbus Helicopters last year as military customers ramp up procurement. Meanwhile, Thales Group, the French multinational specialising in defence electronics, radars and secure communications, generated robust revenues with sophisticated systems that are now critical to NATO and EU security infrastructures. Italy’s Leonardo S.p.A. remains a diversified powerhouse, with capabilities spanning helicopters, avionics and radar systems underpinning strike, air-defence and surveillance missions.

Germany’s formidable defence sector further underlines Europe’s industrial potential. Rheinmetall AG has enjoyed sharp gains as demand for armoured vehicles, artillery and ammunition surges, while its collaboration with MBDA — the pan-European missile systems joint venture co-owned with BAE Systems and Leonardo — highlights how cross-border cooperation can yield market-leading products. Sweden’s Saab AB has also posted strong growth in air defence systems and fighter upgrades, reinforcing that Europe’s defence industrial backbone is distributed across multiple core economies.

Beyond the largest names, mid-tier and niche players are also stepping up. British firms such as Babcock International Group have turned around their fortunes to become key providers of naval support and engineering solutions, attracting investor interest with share price expansions nearing 600 per cent over five years. Smaller innovators — including UK advanced manufacturing and missile-interception start-ups — are drawing capital and contracts, suggesting that Europe’s future defence ecosystem will not be confined to its giants alone.

The case for a Europe-centric procurement policy is not without challenges. Critics caution that strict localisation could disrupt interoperability with NATO allies, reduce competition and drive up costs. Some advanced technologies might still require collaboration with international partners where European industries lag in scale or capability. Yet proponents argue that a truly European supply chain — resilient, interoperable and strategically autonomous — is less a luxury than a necessity in an era of persistent geopolitical volatility.

France’s push for a “Buy European Act” is a reminder that markets do not exist in isolation from national security imperatives. In a world where political winds can shift swiftly, and alliance commitments may fluctuate, European leaders are increasingly aware that industrial strength equates to strategic independence. The past year’s stock performance across the sector bears this out: defence equities in Europe have outperformed broader markets, underpinning the commercial and strategic value of self-sufficiency.

If Europe is to transition from a loosely connected industrial patchwork to a cohesive strategic powerhouse, it must continue to harness the momentum of its best defence companies. From Britain’s BAE Systems to Germany’s Rheinmetall, from Airbus’ aerospace expertise to Thales’ electronics leadership, the foundations of a self-reliant European defence industry are emerging. The challenge now is to turn potential into policy and policy into enduring capability. The continent’s security may well depend on it.

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