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European automakers look to defense spending to offset industry decline
Ford is bidding to supply 9,000 military vehicles over five to seven years, as production at its Dagenham plant has fallen to about half of its output from a decade ago.
European automakers are increasingly looking to rearmament and higher defense budgets to help counter a long-running slump in the region's car industry, according to BBC Business. The outlet frames the shift as a potential lifeline as carmakers face competitive pressure, including from Chinese rivals, alongside reduced capacity in European plants.
Ford, for example, is targeting military demand as it weighs how to replace lost volumes in the UK. At its Dagenham plant in east London, output of three-litre diesel engines has dropped from about 90,000 engines a year to roughly half that over the past decade, and the company is now hoping a pivot to military vehicles can fill the gap, BBC Business reports.
The company is part of a joint venture with defense specialists General Dynamics and Ricardo bidding for a Ministry of Defence contract to supply 9,000 vehicles over the next five to seven years to replace the Army's ageing Land Rover-based fleet. BBC Business also notes historical parallels, pointing to Ford's Dagenham wartime conversion to military production and engine work supporting Allied aircraft during World War Two.
Renault is another example of the defense-linked approach, having signed a strategic agreement with Thales to produce military drones with a target of up to 1,000 units per month. BBC Business says the French military and the Directorate General for Armament want to draw on the existing manufacturing capacity in Europe to support ramped defense procurement.