The Emergence of a Distributed European Defence Industry
Ukraine’s Wartime Industrial Transformation and Its Integration into the European Defence Technological and Industrial Base
Russia’s full-scale invasion of Ukraine in 2022 has fundamentally altered the strategic and industrial foundations of European security. The conflict has demonstrated that high-intensity, industrial-scale warfare has returned to the European continent and that sustaining such warfare requires a defence industrial capacity capable of producing large volumes of equipment, ammunition, sensors, drones, and electronic systems at sustained speed. The war has simultaneously exposed structural weaknesses within Europe’s defence industrial landscape, including fragmented procurement structures, limited surge production capacity, and persistent dependence on external suppliers. At the same time, Ukraine itself has undergone a rapid wartime industrial transformation, expanding domestic defence production, fostering a dense ecosystem of defence technology startups, and developing innovation platforms capable of rapidly translating battlefield experience into technological adaptation. These developments are generating a new industrial dynamic across Europe in which design, production, testing, and operational validation are increasingly distributed across different geographic locations but connected through common institutional frameworks. Within this evolving system, Ukraine is gradually moving from the position of a recipient of military assistance toward that of an operational node within the broader European defence industrial ecosystem.
This report examines how the war in Ukraine is accelerating the emergence of a distributed European defence industry and how Ukraine is becoming structurally integrated into the European Defence Technological and Industrial Base. The analysis first examines the wartime transformation of Ukraine’s defence industry, focusing on the rapid expansion of domestic production, the growth of the drone manufacturing ecosystem, and the emergence of innovation platforms that shorten development cycles through continuous battlefield feedback. It then analyses the European policy framework supporting this process, including the European Defence Industrial Strategy, the European Defence Industry Programme, and associated instruments designed to expand industrial capacity and integrate Ukraine into European supply chains. The report subsequently evaluates the evolving industrial geography created by joint production initiatives, maintenance hubs, and co-development partnerships between European defence companies and Ukrainian industry. Finally, it considers the financial, regulatory, and standardisation challenges that affect deeper integration and assesses the broader strategic implications for European security, including the potential emergence of a distributed defence industrial architecture capable of sustaining high-intensity conflict and accelerating technological adaptation.