By Pierre Tran
Paris – The chief executives of Airbus Defence and Space and Dassault Aviation are seen to be holding the future of European military cooperation in corporate hands, with a Dec. 18 deadline reported to be looming for a new fighter jet project.
That mid-December deadline refers to signing a written agreement on the “core principles of cooperation,” Reuters reported Nov. 25, and includes a “decision roadmap” drafted by Berlin.
The new fighter project reflects French and German political ambitions to build a strong European arms industry, while corporate partners compete to boost technology and earnings.
A December signing by the German partner Airbus DS and French prime contractor Dassault would allow phase 2 of the future combat air system (FCAS) to get under way in 2026.
Phase 2 consists of building and flying a technology demonstrator for a new generation fighter (NGF) at the heart of the future combat air system, and two classes of remote carriers, or drones, by 2029/30. Phase 2 has a budget of around €5 billion ($5.8 billion).
The December agreement is reported to be a bid to bring the fighter project under political control. The proposed roadmap calls on air chiefs of staff of the partner nations – France, Germany, and Spain – to conduct a review of respective requirements.
Berlin and Paris are also reported to be preparing for a retreat, such is the tension between the contractors. Airbus DS and Dassault have made it clear they are ready to go their own way, if their conditions were not accepted for working on the vast FCAS project.
Cooperation could be scaled back to work on a European combat cloud for a command and control network for allied aircraft. That cloud would allow French, German, and Spanish fighters, drones and other aircraft to plug into the global combat air program (GCAP). Britain, Italy, and Japan are backing GCAP, with a separate fighter project at the core, based on the Tempest.
Orderly Withdrawal
The FCAS partner nations are considering scaling back cooperation to work on a combat cloud, the Financial Times business daily reported Nov. 17.
That would mark a retreat from building a new fighter, which would replace the Rafale for France and Eurofighter for Germany and Spain in 2040. Remote carriers or combat drones, and a cloud network would support the new fighter in FCAS, if that were to go ahead.
The testing of European corporate cooperation on the fighter project stems from Dassault’s insistence on clear management leadership as prime contractor, an increase of industrial work share to 51 pct from a third, and protection of intellectual property rights.
Airbus DS accepts Dassault as prime contractor but insists on a share of work that reflects the government funding of the fighter project. A senior Airbus DS executive, Jean-Brice Dumont, has said management of the project should show the “interdependency” that reflects the work share. The latter is tied to state financing, divided equally by the three partner nations.
Dassault sees itself as losing out on work share as presently set out, as Airbus gets more work through its German and Spanish units. Indra is the Spanish industrial partner in FCAS.
Airbus DS is the lead company on the FCAS cloud, working with partners Indra and Thales, a French electronics company. The cloud is one of the five main FCAS projects, or pillars.
The then Airbus DS director for FCAS, Bruno Fichefeux, showed at the 2023 Paris air show a video of how the cloud would work as a battle management tool, linking up crewed and uncrewed aircraft, as well as being interoperable with allies, namely the global combat air program, and U.S. Next Generation Air Dominance (NGAD) F-47 fighter.
Fichefeux later moved on to be head of future programs at Airbus, the parent company based in Toulouse, southern France.
The FCAS budget is reported to be €100 billion.
Europe Responds to Moscow
That FCAS project could be seen as a test of European teamwork, at a time when analysts and French officers see Russia as a rising threat, and China a highly credible military power.
The French President, Emmanuel Macron, announced Nov. 27 a voluntary 10-month national service to start next year, backed by a €2 billion budget. The plan is to recruit an initial 3,000 personnel, rising to 50,000 by 2035, with 18-year-old conscripts offered monthly pay of €800. The personnel will operate solely on “national soil,” the commander in chief said.
Germany also seeks to boost the military ranks, looking to recruit 20,000 next year with voluntary service.
That European call to arms is seen as response to the Russian invasion of Ukraine, amid rising concern in the Baltics, Poland, and Scandinavia.
Meanwhile, political leaders have struggled to rally round the industrial partners, locked in a corporate struggle for leadership – or co-leadership – along national lines.
Dassault is based in Saint Cloud, in the comfortable suburbs of the French capital. Airbus DS is based in Manching, near Munich, southern Germany.
Phase 2 succeeds phase 1B, in which air force officers of the partner nations selected the aircraft architecture. Phase 1B is worth €3.2 billion.
If There Were A Break Up
There is conjecture on what might happen if Airbus DS and Dassault opt out of the joint fighter project, and go their own way.
Airbus DS might seek a place in the GCAP consortium or partnership with Sweden, with the company keen to gain the capability to build a fighter, said Sash Tusa, analyst at equity research firm Agency Partners.
“The question is what is the priority?” he said, as a fighter program would require 10s of billions of euros and a decade or more to build.
“Germany has the largest European defense budget, and Airbus has many, but by no means all, of the engineering skills required to be prime contractor of a sophisticated combat aircraft,” he said.
“The bigger issue is, arguably, the engine – German firms lack the hot section knowledge and track record required for development of a complete engine,” he said. The country would likely have to either buy in an engine from another supplier, whether in the U.S. or U.K., or pay one of these companies for a progressive transfer of necessary technologies.
“Either of these would have a material cost, both financial and time scale.”
There is work for Airbus DS in the near and medium term, with Berlin’s tranche 5 order for 20 Eurofighter jets for the German air force, with the fighters to be armed with electronic warfare kit. That order, announced Oct. 15, comes on top of the 38-strong tranche 4 order, the German Quadriga project, placed in 2020.
Germany has amended its constitution to allow the greater debt funding of half-a-trillion euros to boost its economy, including military spending.
Meanwhile in Sweden, Saab said Oct. 14 the FMV procurement office had awarded the company a 2025-2027 contract worth 2.6 billion Swedish crowns to extend concept studies for a future fighter system, which included crewed and uncrewed aircraft.
French Officer Seeks To Be Heard
The lesson from FCAS is the need for the French military to have a greater say, and cohesion at the European level.
“To change things, greater weight should be given at the operational level,” the joint chief of staff, air force general Fabien Mandon, told Oct. 15 the Senate defense committee. “That can be seen in a large program such as FCAS.
“After eight years, the chiefs of staff of the air force and navy agree on the project, but the partner nations are unable to reach agreement, and we are heading toward the manufacture of two aircraft,” he said.
“It’s irrational, and we are going to buy a product that is more expensive and not so good because we cannot reach agreement among Europeans, when it should be our top priority, it should be ready on the day of attack,” he said.
The air force chief of staff, general Jérôme Bellanger, told the Senate defense committee
French industry needed to deliver an open architecture on future fighters, to allow interoperability with allied fleets. Beyond delivering air superiority, contractors needed to offer interoperability to win export deals, he said.
The open architecture on the Mirage 2000-D meant the service was using the fighter as test bed for onboard artificial intelligence, he said, pointing out the aircraft dated back to the 1980s, with systems of the 1990s.
A priority for the air force was gaining capability for the suppression of enemy air defense (SEAD), to support deep strike missions, he said. There are studies for short term solutions, while there is development for an anti-radar missile and a long-range, stand-off air-to-ground missile for SEAD missions.
Those air strike missions also needed to consider saturation of enemy air defense with low cost weapons, and electronic warfare such as “offensive jamming,” he said.
“SEAD is an imperative…a capability gap for the air force,” he told parliamentarians.
A new weapon to hit enemy air defense could be seen at the U.K. DSEI trade show in September in the London Docklands, in the East End.
MBDA, a European missile company, unveiled its rebranded Stratus weapon. That armament is an Anglo-French development for a future cruise/anti-ship weapon (FC/ASW). The company showed mock-ups of its Stratus Low Observable (LO) missile, previously known as TP15, and Stratus Rapid Strike (RS) weapon, previously known as RJ10.
The French air force saw the Israeli air strikes against nuclear targets deep inside Iran as highly instructive, raising the perceived need for precise, long-range airborne weapons.
However, the budgetary planning is for the Stratus RS missile to enter service in 2035, so the service will need to look to interim weapons and other tactics for the time being.
French Industry Upbeat
Dassault appears to have a bullish medium term outlook, on the French industrial front.
The family-controlled company says it has won orders for 533 Rafale from France and eight export clients, of which 233 are to be delivered.
Dassault is raising monthly production of the fighter to four units from three, and could hit five if more export deals were sealed. The company formally opened Sept. 23 a factory in Cergy, northwest of the capital, in a high key media event. That is the company’s first new plant since the 1970s, and makes parts for the fighter and Falcon business jet.
Macron said Nov. 18 France had signed a 10-year “declaration of intent” with Ukraine, offering to ship up to 100 Rafale, with weapons and pilot training. There was “obviously” a production program, he said at a joint press conference, here, with the Ukrainian President, Volodymyr Zelenskiy at his side.
An op ed from a group which calls itself Mars poured scorn on that prospective Rafale deal with Kyiv, writing it off as a “communications” exercise. There was a lack of industrial and financial capability to make good such an offer, the article said.
That Ukrainian pact with France followed a cooperation agreement with Sweden, announced in October, with Stockholm offering 150 Saab Gripen fighters for an undisclosed amount.
Paris would need to find billions of euros in the national coffers to fund its own new fighter if FCAS were trimmed and France went its own way. France ranks as the third-most indebted state in the European Union, after Greece and Italy. There are 27 E.U. member states.
The French administration has presented its 2026 budget bill to parliament, and the bill refers to a target of a Rafale fleet of 286 fighters by 2035, 61 more than the previously planned 225-strong fleet for the air force and navy.
It remains to be seen whether the fractious French parliament will approve the bill, which seeks to slash the national deficit to three percent of gross domestic product, as requested by the E.U. The French economy grew 0.5 pct in the third quarter, and the French central bank has forecast only slight growth in the fourth quarter, Reuters reported.
Dassault has said it has the capability to build a new French fighter, along with engine maker Safran and Thales, if France baled out of FCAS.
China Seeks to Down Rafale Image
A perceived importance of the Rafale can be seen with alleged Chinese attempts to hurt sales of the French-built fighter, while promoting Beijing’s program for the J-35 fighter.
The annual report by the U.S.-China Economic and Security Review Commission cited a July 6 AP report on Beijing allegedly using AI pictures to support claims of Pakistan downing the Rafale flown by India. That was an example of how China used the “gray zone” to support its interests – in this case, promoting the Chinese-built J-35 fighter.
The U.S. report to Congress said on page 109:
“Following the May 2025 India-Pakistan border crisis, China initiated a disinformation campaign to hinder sales of French Rafale aircraft in favor of its own J-35s, using fake social media accounts to propagate AI images of supposed ‘debris’ from the planes that China’s weaponry destroyed.”
That “information” measure was among the military and security, cyber, and economic actions China undertook in the gray zone, the report said.
The share price of Airbus and Dassault have fallen recently, along with stocks of European arms companies, with the prospect of a settlement in the Russia-Ukraine war.
The seven FCAS pillars cover the new fighter, engine, drones, combat cloud, sensors, simulation, and stealth.