At the end of 2025, the financing of the six main French banking groups for defense companies has reached over 46.6 billion euros. These funds will be used to support the industrial and technological defense base (BITD), made up of nine large groups (Airbus, Ariane Group, Arquus, Dassault Aviation, KNDS France, Naval Group, MBDA, Safran, Thales) but also and on 4,500 small and medium-sized enterprises located throughout the country. A sector that employs 220,000 workers and is now under pressure in the current climate of war economy. While major groups have no trouble securing financing, small businesses are under-capitalized, more indebted, and less profitable after decades of peace compared to small players in other industrial sectors. A study conducted by the Ministry of the Armed Forces and the Treasury Directorate, before the start of the Russian aggression against Ukraine, estimated the equity capital needs of SMEs and ETIs in the defense sector at 5 billion euros. In order to produce more and faster, they need to recruit, finance their working capital requirements (BFR), purchase new machinery, and build stocks of components and raw materials. Sébastien Lecornu, when he was Minister of the Armed Forces, had called for investment in production lines. “Our first weapon is the factory,” says Catherine Vautrin, the current occupant of the Hôtel de Brienne.
Context:
- The article discusses the financing of defense companies in France and the challenges they face in securing funding.
- It highlights the disparity between large defense companies and small to medium-sized enterprises in terms of access to capital.
Fact Check:
- The names of the major defense groups mentioned in the article are accurate and relevant to the topic.
