The US defence industrial base can no longer reliably supply Europe

• Published in: Policy File 2024
• Main Authors: Burilkov, Alexandr, Mejino-López, Juan, Wolff, Guntram B
• Format: Report
• Language: English
• Subjects: Defense; Industry; National security; Tariffs

The United States under the outgoing Biden administration has supported the transatlantic relationship, both through NATO and by providing support to Ukraine. At the same time, the Biden administration has generally positioned itself against European attempts to reduce reliance on foreign arms. For example, the US ambassador to NATO criticised the EU’s aim of buying more home-produced weapons, as set out in the EU defence industrial strategy, proposed by the European Commission in March 2024. Now, with President Trump soon returning to office, US policy towards European security could be at a turning point. Leading figures around Trump argue that US security policy should focus on the Pacific as the US defence industrial base is too small to cater for all threat theatres. Implicitly, there is thus support for the idea that Europe should become more self-sufficient in military terms. Whether this view will become US policy or whether the current policy driven by the defence industry’s interests to sell to the attractive European market will continue to dominate is to be seen. Meanwhile, some in Europe see defence equipment purchases from the US as a strategic tool to fend off tariffs. But this strategy would need sufficient capacity in the US military base and timely delivery or, rather than procuring modern equipment fit for its eastern flank, the EU would risk overpaying for late and second-rate products, entrenching dependence through long-term contracts for maintenance and supply. We assessed non-US demand for US military industrial capacity by analysing US foreign military sales (FMS), compiling a database from US Defense Security Cooperation Agency data, as reported by the Pentagon. We show that large shares of US-produced weapons, such as shells for tanks and artillery and air defence missiles and their components, are sold currently to Europe and Israel. If Trump wants to re-calibrate US defence sales, for example to increase domestic stockpiles or to increase supplies to allies in Asia, then Europe could face shortages in arms availability. This raises two immediate consequences. First, Europe will need to increase domestic production of weapons systems, and this is in line with US interests. Second, the EU cannot rely on arms purchases as a negotiating tool with the incoming US administration to obtain a favourable deal on tariffs. US production is insufficient for Europe to meaningfully buy, let alone increase, its weapons purchases.