Key Takeaways

  • The Trump administration’s National Security Strategy has sparked tension with Europe.
  • European nations have pledged billions in defense increases.
  • Industry collaboration between US and European firms is expected to flourish in 2026.

Strategic Implications

The upcoming year may see a rebirth for local industries if countries are serious about their plans to invest. However, relations between Washington and Europe appear headed for a low period due to the Trump administration’s aggressive stance. The pressure on Ukraine to sign a ceasefire agreement could disrupt orders from European customers for US defense equipment over the long term.