By Giulia Segreti
ROME (Reuters) -U.S. President-elect Donald Trump’s push for Europeans to spend more on defence is in line with the goal set by Italy’s Leonardo for more cross-border alliances in the sector, the aerospace and defence group’s chief executive said on Thursday.
“The message is clear, (Trump) wants a stronger Europe participating more effectively to the global investment for defence. This is consistent with … Europe getting together, for a common space for defence,” CEO Roberto Cingolani said.
In a post-results call with analysts, he said the European Commission was also “going in this direction” and that groups such as Leonardo would benefit from any rise in defence budgets.
Trump’s return to the White House is seen as bullish for European defence stocks, given his warnings that he intended to scale back U.S. military support and force NATO members to spend 2% or more of their GDP on defence.
The Rome-based conglomerate was among top gainers in European defence stocks after his elections, growing further after a rise of more than 250% since Russia’s invasion of Ukraine in early 2022.
Cingolani said a swift end to the war in Ukraine would not translate into “less business” for the group.
Leonardo has made no secret of its intention to play a proactive role in the expansion of the European defence sector, with Cingolani pushing for broader European alliances and greater cooperation among defence manufacturers.
In October the Italian giant and its German peer Rheinmetall agreed to a joint venture to develop and build military combat vehicles — a key step towards long-awaited consolidation in the sector.
A former government minister, Cingolani said Rome was well set to have “very good relations with the new U.S. administration, thus facilitating dialogue” between countries.
BOEING TROUBLES
Leonardo stopped short on Thursday of raising its 2024 guidance due to external factors, including Boeing’s various problems, but Cingolani said nine-month results were very promising.
The state-controlled group said it expected to release an update to its industrial plan in March 2025.
Its aerostructures business, which designs, develops and manufactures some of the components for Boeing’s 787 Dreamliner airframe, has been hit by the U.S. firm’s troubles.
Cingolani said Leonardo could not wait for Boeing to resolve its issues, adding that the aerostructures division could no longer dedicate itself exclusively to the U.S. giant.
He said the group was considering new business opportunities which would be announced in the strategy update. ($1 = 0.9249 euros)
(Reporting by Giulia Segreti; Editing by Crispian Balmer)
