The European Defense Industry in an Era of Great Power Competition. Why China’s Rise Is Not (Yet) a Game Changer

Lucie Béraud-Sudreau and I published this chapter in a book entitled Turbulence Across the Sea. Transatlantic Relations and Strategic Competition (University of Michigan Press), coedited by Elie Baranets and Andrew R. Novo. Our chapter compares the EU defence industry’s footprint in the US and China based on data indicators (revenue, composition of boards, and local subsidiaries). Lucie and I find the existence of a fragmentation between two clusters of companies, one constituting a European defense industrial base, the other choosing internationalization in the United States.

> Chapter outline:

Introduction

– Where Are the Major European Defense Companies Internationalizing?
Indicators: Export Revenue, International Presence, Foreign Managers
Case Studies: Widening the Comparison to the 28 Largest European Companies
Primary Sources: Business Activity Reports and SIPRI Database

– The Limited Internationalization of European Companies in China
Limited Dependence on the Chinese Market
The Establishment of European Companies in China: The Exception Rather Than the Rule
An Absence of Chinese Leaders in the Management of European Defense Companies

– The United States as a Privileged Internationalization Territory
Greater Dependence on the American Market Than on the Chinese Market
A Strong Presence of European Companies in the United States: The Rule Rather Than the Exception
American Executives at the Head of European Companies Based outside the EU

– Choosing the European Continent or the American Territory: Two Models of Internationalization
Preference for the European or American Market: Industry Cut in Half
A Stronger Presence in Europe Than in the United States
European Leaders at the Head of EU-Based Companies

Conclusion