Europe Wants a Bigger Defense Industry. This Is What It Looks Like Now

As European countries increase their defense spending to counter the threat from Russia, China, and Iran, can Europe’s arms manufacturers up their game?

Chancellor of the Exchequer Rachel Reeves speaks to media during a visit to Rheinmetall BAE Systems Land in Telford, England, on March 24, 2025. Jacob King - WPA Pool/Getty Images

European countries are ramping up their defense spending in response to growing threats from not just Russia but also China and Iran, amid growing concern that the United States could withdraw its military umbrella from the continent.

And the European Union is keen to make sure the extra money is spent in Europe itself.