Germany’s defense industry stands at the cusp of a new growth era, yet grapples with significant self-doubt, according to a recent survey by strategy consultants Horváth. The survey, encompassing 73 executives and industry specialists, highlights both the opportunities and challenges facing the sector amidst a shifting geopolitical landscape.
The dominant sentiment, expressed by 87% of respondents, is that the conflict in Ukraine has ushered the defense industry into a new phase of expansion. This growth is anticipated to persist for at least the next decade, even beyond the conclusion of the ongoing situation.
However, the survey also reveals a less optimistic perspective regarding the modernization of the German armed forces. A substantial majority – roughly two-thirds of those polled – believe that a complete overhaul will require considerably more than ten years to achieve.
Concerns are also surfacing regarding the industry’s ability to achieve strategic independence within Europe. Nearly half of the respondents expressed skepticism, suggesting that true autonomy in defense capabilities remains an unrealistic goal. Furthermore, progress on major European collaborative projects for air and land forces is deemed inadequate by 31% of participants, with 50% attributing the lack of advancement to divergence between political agendas and internal industry conflicts.
A critical obstacle to rapid growth appears to be a pervasive shortage of skilled personnel. Managers report significant staffing gaps and difficulty in filling open positions, despite observing a growing public acceptance of the defense industry’s role. Alarmingly, 94% of surveyed defense experts contend that bottlenecks in personnel and supply chains are hindering the industry’s preparedness to swiftly scale up production.
