European Commissioner for Defence and Space Andrius Kubilius, in a speech at the European Defence and Security Summit on 23 June 2026, called for a more integrated European defence market, warning that the United States may soon move strategic enablers away from Europe. Kubilius argued that Europe must replace American capabilities such as air-to-air refuelling and space-based intelligence, estimating the cost at hundreds of billions of euros, with the Kiel Institute's Sparta 2.0 paper putting the figure at €500 billion.
support and integrate Ukraine's military and defence industry; shift from 'haute couture' to 'good enough' mass production; and create an integrated European defence market. He noted that Ukraine's defence industry has grown from €1 billion in 2022 to €50 billion in 2026, and urged Europe to adopt Ukraine's approach of rapid, scalable production. The Commissioner also highlighted that up to 80% of defence procurement in the EU uses the TFEU Article 346 exemption for direct awards, which he said stifles competition and innovation, particularly for start-ups and SMEs.
the European Council stressed the importance of the defence market last week; the Commission will present a communication on a more integrated defence market next week; and later this year it will propose changes to defence procurement rules. He also cited US Secretary of War Pete Hegseth's call for a 'NATO 3.0' with Europe taking the lead on conventional defence, and a six-month Department of War review of US force posture in Europe. Kubilius warned that without filling strategic gaps, Europe risks inviting Russian aggression, noting that Russia is still outproducing Europe and testing Article 5.
integrating Ukraine into the European Defence Fund and the Drone Alliance, launching BraveTech EU for battlefield innovation, and reforming procurement rules to reduce fragmentation. However, it lacked specific numerical targets or deadlines for market integration. The policy orientation is towards deeper EU-level coordination and a more assertive, self-reliant defence posture, shifting from a US-dependent model to European-led deterrence. Stakeholder impacts include: EU defence industry (positive for primes and SMEs if market opens up, but primes may face more competition); national defence ministries (positive from economies of scale, but loss of direct award flexibility); EU start-ups and SMEs (positive from easier market access); and EU taxpayers (positive from potential cost savings, but upfront investment needed).
Kubilius stressed that the €131 billion proposed for Defence and Space in the next EU budget is insufficient, and that the bulk of funding must come from national budgets, with Member States pledging €6.8 trillion over ten years. He urged joint orders and 'ever warm' production facilities to provide long-term visibility for industry. The speech did not address how to reconcile national sovereignty concerns with deeper integration, nor did it detail how to enforce compliance with new procurement rules.