EU Defence Industry Transformation Roadmap: What Aerospace, Defence, and Space Clients Need to Know

Overview and strategic context

On 19 November 2025, the European Commission published the EU Defence Industry Transformation Roadmap, setting a fast‑paced agenda to modernize Europe’s defence industrial base and align it with readiness needs by 2030. Rooted in lessons from Ukraine and driven by disruptive technologies, the Roadmap aims to accelerate capability development and deployment, improve access to defence contracts, and scale manufacturing – particularly by better integrating “New Defence” actors such as startups, SMEs, and dual‑use deep‑tech companies alongside established primes. For clients in Germany and across the aerospace, defence, and space sectors, the Roadmap signals a fundamental policy shift: speed, agility, modularity, interoperability, and rapid procurement are being prioritized to build credible deterrence and operational resilience. 

Three core objectives

The Commission articulates three clear objectives for transformation. First, it seeks to connect defence and deep‑tech communities to speed disruptive innovation and attract talent. Second, it aims to accelerate the integration of advanced technologies – especially AI, quantum, cyber, and space‑based systems – into Member States’ capabilities. Third, it intends to enhance Europe’s defence production capacity through advanced manufacturing, with a methodical emphasis on scale, cost‑efficiency, and industrial agility. These objectives complement the broader Defence Readiness Roadmap 2030 and are meant to reshape both supply‑side innovation and demand‑side procurement practices. 

Operational lessons from Ukraine and implications for EU industry

The Roadmap draws a direct line from battlefield realities to industrial policy. Ukraine’s approach – software‑defined systems, rapid iteration, modular open architectures, and mass manufacturing of low‑cost systems (e.g., FPV drones) – serves as a template for European procurement and industrial scaling. Over 230 defence‑tech startups have launched in Europe since 2022, with private investment reaching record levels. The Commission intends to translate war‑time innovation dynamics into EU frameworks, including stronger knowledge transfer via an enhanced EU Defence Innovation Office presence in Kyiv, association of Ukraine to the European Defence Fund, and the BraveTech EU initiative to co‑develop, test, and deploy joint solutions across drones, EW, cyber, and battlefield medical technologies. 

Technology priorities: AI, quantum, cyber, and space

The Roadmap underscores dual‑use technology integration. AI is positioned as a central enabler of command‑and‑control, precision operations, and automation. Quantum technologies – sensing, communications, and future computing – are highlighted for GNSS‑denied navigation, ultra‑secure data transmission, and logistics optimization. Cyber is treated as a fifth warfighting domain with a focus on resilience and offensive/defensive integration, including protection of critical infrastructure. Space‑based systems are identified as the data backbone for multi‑domain operations, with initiatives like IRIS², Galileo’s PRS, and the planned Earth Observation Governmental Service intended to strengthen secure communications, geospatial intelligence, and operational coordination. For German space and spacetech companies, the Commission’s commitment to leveraging commercial space services – including potential direct procurement of geospatial products – marks a significant demand‑side opportunity. 

Finance and scaling: funding the full investment journey

The Commission acknowledges persistent gaps in European growth capital, particularly for late‑stage defence startups and scaleups. It proposes an up to €1 billion Fund‑of‑Funds (with EIB/EIF support) by Q1 2026 to provide growth capital and help consolidate supply chains, alongside the Defence Equity Facility and expanded InvestEU support. Horizon Europe and the EIC will strengthen dual‑use pathways, with the EIC Accelerator supporting dual‑use projects from 2026 and STEP Scale‑up aiding critical defence technologies. Cohesion Policy funds can be voluntarily targeted to defence and dual‑use capacities. For German innovators, this expanding mix of equity, debt, and grants – combined with defence‑specific accelerators – creates a clearer capital stack to scale manufacturing and navigate the “valley of death.” 

Time‑to‑market acceleration: infrastructures, manufacturing, and data

To compress development cycles, the Commission will launch a pilot instrument for rapid defence innovation with 6–12 month time‑to‑result windows, tailor EDF processes for disruptive technologies, and open EU infrastructures – JRC facilities, AI factories, chips pilot lines, quantum facilities – and Member State test environments (including sandboxes) to New Defence actors. A Manufacturing‑as‑a‑Service and Security‑as‑a‑Service model is proposed to allow SMEs to leverage existing industrial capacity, enabling faster scale‑up with reduced upfront investment. Additionally, the Commission plans mutual recognition schemes for certification and validation and the creation of a European Defence Data Space by 2028 to power AI models, digital twins, and predictive maintenance. For clients working across borders, these moves aim to cut redundancies, promote interoperability, and reduce fragmentation.

Access to contracts: procurement transformation and market visibility

The Roadmap pivots procurement from transactional purchasing to strategic industrial investment. Key proposals include EUDIS Tech Alliances to connect startups/scaleups with end‑users around priority capability areas, an EU marketplace to fast‑track procurement of EDF‑backed technologies (with a focus on SMEs), and a Commission role as a direct customer for dual‑use companies in space. Member States will be encouraged to allocate at least 10% of armament procurement budgets to emerging and disruptive technologies. Crucially, the Commission will revise the Defence and Sensitive Security Procurement Directive to enable faster, more transparent, and SME‑friendly procedures, including fast‑track routes for low‑cost products and rapid onboarding of disruptive technologies. For German industry, this procurement modernization could materially lower barriers to entry and speed contract cycles – particularly when paired with national innovation units and EDA platforms such as HEDI. 

Skills and talent: addressing the workforce bottleneck

The Roadmap identifies talent shortages as a strategic risk. It supports the Large‑Scale Skills Partnership in Aerospace and Defence under the Pact for Skills, aiming to upskill around 12% of the existing workforce annually and reskill 600,000 people for defence by 2030. Proposed measures include an EU Defence Industry Talent Platform with vouchers for traineeships in SMEs and startups, leveraging existing online academies (e.g., EUSPA Space Academy), and exploring a dedicated EU Defence Industry Skills Academy from 2028. Security clearances and citizenship requirements are recognized as mobility constraints; the Commission’s approach focuses on improving visibility of quality jobs, pay, and working conditions, and promoting diversity. German employers should prepare to compete aggressively for AI, quantum, cyber, and advanced manufacturing talent and utilize EU‑level instruments to build capacity. 

Action points for aerospace, defence, and spacetech companies

The Roadmap rewards companies that can iterate rapidly, integrate dual‑use technologies, and operate within modular, open architectures. Firms should position offerings to align with emerging EU flagships and capability coalitions, leverage EU testing and validation infrastructures, and prepare for a more streamlined certification environment. Space companies should anticipate procurement opportunities for commercial services and data products. SMEs and scaleups should track the upcoming rapid innovation pilot and Manufacturing‑as‑a‑Service initiatives to de‑risk scaling. All actors should prepare for procurement changes, including fast‑track paths and greater transparency, and engage early with EUDIS Tech Alliances and EDF‑linked marketplaces to increase visibility and shorten sales cycles. 

What this means for German market participants

Germany’s industrial strength and research base provide significant upside under the Roadmap, particularly for high‑end aerospace systems, space‑based services, and deep‑tech defence solutions. As procurement reforms reduce fragmentation and favour disruptors, German companies – both established primes and New Defence actors – can benefit from cross‑border test environments, harmonized validation, and new financing vehicles. Engagement with EU‑Ukraine collaboration platforms will be important to absorb battlefield lessons into product roadmaps. Finally, with Member States incentivized to allocate a portion of armament budgets to emerging technologies, German innovators should align offerings with AI‑enabled systems, quantum‑enhanced sensing and communications, next‑generation cyber defence, and space‑based decision superiority. 

How HEUKING can assist

As a Germany‑based firm with deep sector experience in aerospace, defence, and spacetech, we support clients across the full lifecycle of opportunities unlocked by the Roadmap:

• EU and German public procurement. Strategy and execution for faster procedures under the revised Defence and Sensitive Security Procurement framework and German VSVgV/UVgO regimes; framework agreements, dynamic purchasing systems, agile lots, and SME‑friendly fast‑track routes.
• EU funding access and compliance. End‑to‑end support for EDF, EUDIS Tech Alliances, Horizon Europe/EIC, InvestEU, and cohesion instruments, including consortium building, grant and equity structures, eligibility, state‑aid and co‑financing compliance, and audit‑ready documentation.
• Consortia, JVs, and industrial cooperation. Negotiation and set‑up of teaming agreements, IP/foreground/background arrangements, data‑sharing, open/modular architecture commitments, and manufacturing‑as‑a‑service models.
• Foreign investment control and security approvals. German AWV/EU FDI screening filings, sector‑specific licensing, reliability checks, facility security clearances, and handling of classified contracts and information.
• Export controls and sanctions. EU Dual‑Use Regulation, German export law, and alignment with allied regimes (including ITAR/EAR touchpoints), plus sanctions risk management for cross‑border development, testing, and supply chains.
• Data, AI, and cybersecurity. Governance for defence‑grade data spaces, AI assurance, model risk, and secure DevSecOps; compliance with NIS2, CRA, and sectoral cybersecurity requirements.
• Space and dual‑use commercialization. Structuring commercial services procurement (e.g., IRIS², PRS‑adjacent uses, EO data products), licensing, spectrum, and downstream distribution.
• M&A, growth capital, and venture financing. Transactions for scale‑ups and incumbents, fund structures, minority protections, and strategic partnerships to access the emerging EU fund‑of‑funds and defence equity facilities.
• Standards, certification, and testing access. Mutual recognition pathways, conformity strategies, safety‑critical assurance, and access to EU/JRC, national test ranges, and sandbox environments.

Outlook

The Commission intends to begin implementation immediately and scale measures from 2028, with annual strategic dialogues to monitor progress and share best practices. For clients in aerospace, defence, and space, the Roadmap is both a policy signal and an operational blueprint: speed and scalability are central, dual‑use technology pathways are expanding, and procurement will increasingly reward innovation, interoperability, and industrial resiliency. Early positioning will be critical to capture growth and contribute to Europe’s defence readiness by 2030.