December 1, 2001
In August 2000, PREST (Policy Research in Engineering, Science & Technology), a research institute of the University of Manchester, was asked by CNA to undertake a study of the participation of ten leading US defense contractors in the European defense market. PREST was also asked to profile two leading European defense contractors-BAE Systems and Rolls-Royce-and analyze their participation in the US defense market. For each US company, the report describes and analyses the company's participation in the European defense market in terms of its current and potential future foreign military sales and its defense-related strategic alliances, joint ventures, and acquisitions/divestments involving European firms. The report also shows that the participation of US companies in the European defense market has evolved over the last fifty years from predominantly government-led arrangements driven by Cold War concerns about Western European military capabilities toward increasingly industry-led relationships driven by commercial concerns about market access. The report also profiles BAE Systems and Rolls-Royce participation in the US defense market in the same way. Looking to the future, the report makes clear that companies in the newly consolidated European defense industry and their US counterparts will face significant and on-going business pressures to expand their international activities, and transatlantic relationships are likely to be an important dimension of their strategies.
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