Two European fighter jet programmes are too many - AlixPartners

2 minute read

Scale models of the Franco-German-Spanish Future Combat Air System (FCAS), Europe's next-generation fighter jet, are seen in Paris, France, February 20, 2020. REUTERS/Charles Platiau

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MILAN, Nov 30 (Reuters) - Europe cannot afford to fund two fighter jet programmes, AlixPartners said on Tuesday, adding that the defence sector would go through a consolidation process as groups scramble to boost their exposure to electronics and cybersecurity.

At a time when European Union members are discussing closer cooperation on defence, they are split on the development of common defence projects including a new military jet.

Britain and Italy are working to build the Tempest fighter with a view to replacing their Eurofighter Typhoon jets from 2040, while France, Germany and Spain are working on the rival Future Combat System (FCAS) project to replace France's Rafale and German and Spanish Eurofighters.

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Last week, Italy's Air Force Chief of Staff said he expected Tempest and FCAS to merge in the medium term.

"If a new fighter is developed, two options are too many," Paolo Rinaldini, managing director for AlixPartners in Italy, said during the presentation of the consultancy firm's forecasts for the defence and the aero sectors.

AlixPartners monitors trends in the global economy and publishes regular forecasts on defence and aerospace groups.

Rinaldini said that big defence groups were all looking for acquisitions and partnerships to strengthen their position in defence electronics and cybersecurity, two areas where they see higher future growth.

As an example, the consultant mentioned the decision of Italian defence group Leonardo (LDOF.MI) to buy a 25% stake in Germany's sensor maker Hensoldt (HAGG.DE).

AlixPartners expects defence spending of European NATO countries to continue to stay below of a target of 2% of their gross domestic product in the next five years after touching a peak of 1.76% last year.

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Reporting by Francesca Landini; Editing by Nick Macfie

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