Under constant attack, Ukraine’s arms makers take shelter in European factories
Ukraine’s drone makers and electronic warriors will soon be able to escape Russian bombing by moving to European factories — teaching the EU their ways in the process
The first batch of Ukrainian-made drone missiles "Peklo" (Hell) is delivered to the Defense Forces of Ukraine in Kyiv, Ukraine, on Dec. 6, 2024. (Genya Savilov / AFP via Getty Images)
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Ukraine’s wartime weapons technology looks bound for the West for the first time.
"Our joint projects are the first real chances for our Ukrainian production abroad," Ukrainian President Volodymyr Zelensky said while announcing a newly signed agreement with Denmark on July 4. "This concerns drones, and many other necessary forms of weapons."
The deal "opens the path to the creation of Ukrainian defense production on the territory of Denmark," wrote Strategic Industries Minister Herman Smetanin on the same day.
The co-production is one of many in the works with European nations looking both to help Ukrainian companies build outside of a country that faces daily Russian bombing raids and to acquaint European defense and tech companies with the latest in Ukrainian battlefield technology.
The vast majority of weapons manufactured under these programs will return to Ukraine, where the IP will also stay, Ihor Fedirko told the Kyiv Independent. Fedirko recently left the Strategic Industries Ministry to head the Ukrainian Council of Defense Industry, a government-supported trade association.
Various Ukrainian drone makers already have factory access outside of Ukraine, but those arrangements predate the unofficial export controls that Ukraine imposed after martial law was enacted following the start of Russia’s full-scale invasion. First-generation Ukrainian drone makers like DeViRo and Skyeton, both founded over a decade ago, have factories in the EU opened before 2022.
Export controls have locked newer military goods in-country for the past three years, though no official ban has ever been introduced. Those controls have kept much of Ukraine’s most innovative and lethal new hardware inside, to the widespread consternation of local arms makers stuck watching foreign firms profit off of technology designed and tested in Ukraine while they can only sell to the cash-strapped Ukrainian military.
"Let’s be honest here, the export of military technology has always been controlled — no nation on earth has ever just thrown around weapons like bread or flour," Fedirko said.
"We’re no exception, but the question is to finally allow companies to sell at least something, even in small orders, and only to partner nations with whom we’ve signed security agreements."
In the case of Denmark, about 5% of the final products will remain with the Danish host companies, who will get experience in the manufacturing process and to experiment with the final products.
Ukraine is at a turning point. The new co-production deals promise to provide new markets and integrate Ukraine’s arms industry into NATO’s defense, a meaningful step towards membership. But the deal’s details remain murky, raising questions as to whose weaponry and how participants will be selected.
Ukrainian journey to the West
Denmark was the first nation to fund Ukrainian defense start-ups directly in an arrangement that began last year. They are also the first country to formally open a program inviting Ukrainian companies to build in Danish factories. It’s a deal that Danes hope will build out their own long-term military industry while providing Ukraine with more weapons in the near future.
"Things changed after (Donald) Trump was elected," said Esben Gadsboll, a Danish startup founder whose Defense Innovation Highway helped set up many of the contacts that drove the deal between Denmark and Ukraine.
"Until then, the sentiment in the Nordic countries was that we want to help Ukraine, basically because we want to help Ukraine. Now it's also about us getting afraid of something."
That something is an increasingly aggressive and well-armed Russia and a U.S. that has pulled away from its commitments to the NATO alliance.
The Danish government has bestowed 50 million euros on the program to bring Ukrainian companies into Danish factories to build their latest wares, said Eric Wanscher. A Danish Air Force Reservist and operator of a government-funded business hub called Erhvervshus Fyn, Wanscher works on matchmaking between Danish hosts and their potential Ukrainian defense tech guests.
"It's hard to talk on behalf of the nation, but I would say from my point of view, it is very important that we get production into Denmark,” Wanscher said. "We will learn to produce, and the Ukrainians will get more capacity, because they can produce in a safe environment."
Ukrainian factories face constant bombardment, one of the biggest barriers to producing weapons, especially the most technologically complicated systems or basic materials requiring mass chemical processes. EU nations like Denmark have been slow to expand their domestic production independently.
Deals with Norway and the United Kingdom, announced at the end of June, are similarly opening the door to Ukrainian companies to build in those countries.
The shift to Ukrainian co-production in the West would expand and stabilize Ukraine’s production of weaponry. Ukrainian companies involved stand to gain safety and money in sales. The European companies playing host stand to pick up on experience building the newest technology, which traditional arms giants have overtly lusted after from afar for two and a half years now.
"This is an industrial competition. Denmark is not the only country that wants to have Ukrainian companies. Germany, Holland, and France want to have Ukrainian companies," said Wanscher, adding that Ukrainian companies are finding themselves weighing propositions from European countries.
Details on the contracts are limited. A representative for Ukraine’s Strategic Industries Ministry declined to comment or provide details, beyond that the deals were at an early stage and officials were "feeling them out."
A representative for Terma, Denmark’s largest defense company, told the Kyiv Independent that it is "too early for us to comment on the co-production model as it is still a work in progress."
Wanscher agreed that the program has not been formalized but said, "We are kind of working around it."
"I know that there has been a pre-selection of some of the companies for the program, that's like a public secret."
The sectors of greatest interest seem to be deep-strike drones, including "missile drones," as well as interceptors and electronic warfare systems — sectors valuable for Ukraine to produce more of, and which Danish companies aren’t making en masse themselves. The Danish hope is to import production that they don’t already know how to make.
"If you do a similar thing to a Danish company, they will be more reluctant to include you in a cooperation deal," Wanscher said.
Gadsboll pointed to drone and robotics clusters in Odense and Aalborg as especially promising venues for co-production because companies based there are most familiar with the types of Ukrainian projects Denmark is looking to import, like automated interceptor drones and long-range strike drones.
The arrangement also opens up testing and demonstration of Ukraine’s most advanced wares to Western officials and investors unable or unwilling to come into a Ukraine so frequently under attack. Ukrainian arms producers hope to advertise their wares to purchasers for a time when exports fully open up.
The move on Denmark’s part is a means of looking out for future security by building a modern arms industry. For Ukraine’s strategically important productions, ranging from missile-drones and classic missiles to Bohdan artillery, the danger is already less abstract.
As Fedirko put it, "They wanted to have the production further from the front. Where Russia doesn’t have the right to bomb the territory — for now."
Author's note:
Hi, this is Kollen, the author of this article. Thanks for reading. Ukraine is holding up in the face of a tense summer and persistent Russian assaults. Meanwhile the technological wizardry that has kept the country alive and fighting is slowly making its way into NATO arsenals. If you want more stories like this, consider joining our community today to help support our work.
