Between Legacy and Emergence: The Spatial Integration of New Defence Companies in Europe’s Historical Defence Landscape

This ARES Group Policy Paper proposes a geographical analysis of “New Defence” companies. The paper focuses on manufacturers of drones (all domains), small satellite and launchers, and high-altitude platform stations. It explores the geographical distribution of new defence companies within the largest European arms-producing states, specifically looking at whether new entrants on the defence markets emerge in the same or different local ecosystems where historical defence companies are already located. The results show that, due to the lower barriers to entry for some of the new defence technology products, the emergence of new defence companies expands the industrial base beyond the traditional manufacturers and are more geographically scattered within Member States. Nonetheless, in some markets, path dependency and historical lock-in effects remain strong. The paper concludes with policy implications for national and EU defence industrial support instruments, highlighting the need to focus on regional policy instruments to best calibrate policy tools in support of new defence companies.