Hesitation over the aircraft of the future: when Europe’s defense sector comes face to face with its contradictions
“Coopetition”—that is, cooperation on a specific project between two entities that are otherwise competitors—is a complex process that can run into difficulties at various stages. This is evident when examining the difficult progress of the “aircraft of the future” project jointly undertaken by Dassault and Airbus Defense and Space.
Chloé Zanardi, TBS Education and Frédéric Le Roy, University of Montpellier
While Dassault continues to enjoy international success with its Rafale, the Future Combat Air System (SCAF) project—intended to embody the future of European combat aviation— is stalling. The summer of 2025 marked yet another setback for the ambitious Future Combat Aircraft program, which brings together Dassault, representing French interests, and Airbus Defense and Space, representing German interests in particular.
Since its inception, the project—which is primarily billed as a“coopetition”between Dassault and Airbus Defense and Space—has struggled to make progress, even though it has been touted as the successor to the Rafale. On July 22, Éric Trappier, CEO of Dassault, criticized the project’s governance as “lacking a true leader” and threatened to withdraw from the program. Berlin initially responded by warning against any change in governance that would favor the French manufacturer, before in turn threatening to leave the project and seek new partners.
The reality is that cooperation has ground to a halt, despite the fact that Europe is seeking to strengthen its strategic autonomy in the current geopolitical context. The central question is this: how can we reconcile the defense interests of European nations—which necessitate ambitious European programs such as the SCAF—with the interests of national companies?
What is SCAF, and why is it strategic?
Launched in 2017, the SCAF project aims to develop a fighter jet capable of competing with the U.S. F-35 Lightning II. According to France and Germany, the project’s initiators, as well as Spain, the F-35 poses a threat to European sovereignty and justifies the launch of a specifically European program.
The SCAF is scheduled to enter service by 2040, with ambitious goals. It is a system of systems comprising a stealth aircraft, a “combat cloud,” and a fleet of drones, designed to keep pace with the technological advancements of other major powers. The project is currently in Phase 1B, a preparatory stage prior to the construction of a flight demonstrator in Phase 2. https://www.youtube.com/embed/SN_G4iN1rdo?wmode=transparent&start=0
For Berlin, the goal is to ensure the continued viability of its military aviation industry through close cooperation with France and Spain. “The success of the project is essential to the competitiveness of the German and European military aviation industries,” the German Federal Ministry of Defense emphasizes in the19thGerman Defense White Paper.
Coopetition and Sovereignty: The European Dilemma of the SCAF
Coopetition—that is, cooperation with a competitor—is based on a paradoxical logic. Companies collaborate to create value, but at the same time seek to capture as much of it as possible for themselves. This leads them to share knowledge to advance and co-innovate, while protecting their strategic know-how to prevent unwanted transfers. Coopetition thus blends trust and mistrust in equal measure and inevitably generates tensions.
At the European level, coopetition between member states and among industrial firms appears to be a strategic lever for strengthening technological sovereignty. However, this strategy also entails major risks: the transfer of sensitive knowledge, the asymmetric capture of value co-created with a partner… who remains, after all, a competitor (Le Roy et al., 2022).
These issues take on a particular significance when they involve sovereignty. Cooperating with a foreign company—even a European one—can amount to giving it the means to compete with you in the future.
In the SCAF project, this "coopetition" dilemma is particularly significant. Dassault, on the French side, and Airbus Defense and Space, on the German side, must cooperate to develop the aircraft of the future as part of a European initiative. But Dassault and Airbus Defense and Space are competitors on the global market, with the Rafale for Dassault and the Eurofighter for Airbus. Since its inception, this ambivalent relationship has fueled persistent tensions that undermine the program’s progress.
"Coopetitive" tensions within the Scaf project
The tensions between Dassault and Airbus Defense and Space primarily concern the division of responsibilities and project governance. Initially, an agreement called for an equal split (50/50), with Dassault designated as the prime contractor due to its expertise. But in 2019, Spain’s involvement led the governments to propose a three-way split.
This rebalancing, perceived as a challenge to Dassault’s central role, marked the beginning of a conflict that has never subsided. Airbus considers the division of responsibilities unfair and challenges France’s leadership of the project, while Dassault refuses to back down. In the absence of an agreement, Phase 1B of the program—aimed at building a flight demonstrator—has been stalled.
The tensions also concern knowledge sharing, an issue directly linked to sovereignty concerns. Berlin has demanded that Dassault grant access to certain technologies, a request the French manufacturer has refused out of fear of an unintended transfer of knowledge. Airbus Defense and Space, however, believes that without this exchange, it will not be able to fully benefit from the joint development. Angela Merkel had already emphasized in 2021 that “issues of intellectual property, division of labor, and leadership” remained central. The CEO of Dassault echoed this sentiment: “If I share my background today and the program is canceled in two years, how would I be protected from the competition?” https://www.youtube.com/embed/a9czGLMncO4?wmode=transparent&start=0
A political compromise was indeed reached in late 2022 between Paris and Berlin to unblock Phase 1B and confirm Dassault’s role. However, disagreements persist and are once again slowing down the program, risking the future of the project. Dassault Aviation is calling for clearer governance to ensure it has the necessary latitude to fulfill its role as prime contractor for Pillar 1 (aircraft development).
“The question arises as to the effectiveness of a project involving three countries […] where there isn’t a true leader but three ‘co-co-co’s.’ […] How can I provide leadership when I have someone sitting across from me who carries twice as much weight? How can I lead a program if I don’t even have the right to choose my subcontractors in France, Spain, and Germany? That’s not the right way to fly a plane,” summarized Éric Trappier, CEO of Dassault Aviation, on July 22.
Airbus Defense and Space, for its part, rejects any change in governance. “If people want the SCAF to exist, we all know how to make it happen. We just need to go back to what was agreed upon and stick to it. But if some people think we have to start from scratch, that’s not acceptable,” said its CEO, Michael Schoellhorn, on June 19, 2025, at the Paris Air Show.
The result: the project remains stalled in Phase 1B, which was supposed to lead to a flight demonstrator. For now, the “future air combat system” still exists only on paper. A long and competitive road therefore lies ahead.
SCAF is at the center of a debate that intertwines sovereignty, coopetition between states and companies, and the sharing of technological expertise. Coopetitive tensions are jeopardizing its progress, while states—far more than mere financiers—appear to be the true political orchestrators and arbiters of this fragile coopetition. “We will make a decision on the future of the project by the end of the year,” Friedrich Merz warned in late August, noting that the process “cannot go on indefinitely” and that it is now imperative to “break the deadlock and accelerate, as the project can no longer tolerate any further delays.” But how?
Managing cooperative-competitive tensions
Research on coopetition shows that coopetitive projects are fraught with paradoxical situations that firms must learn to manage (Le Roy et al., 2024). Coopetitors must simultaneously share and protect their knowledge, co-create value while seeking to claim it individually, and build trust while maintaining a degree of mistrust. Their strategic interests may diverge, generating tensions related to opportunistic behavior or project governance, as illustrated by the SCaf case. If not anticipated and managed, these tensions risk hindering collaborative dynamics and slowing project progress.
Managing coopetitive projects therefore requires appropriate measures: structural separation between cooperative and competitive activities, individual integration of coopetitive paradoxes, and the establishment of specific mechanisms—both formal and informal.
In some cases, the literature also highlights the importance of involving a third party capable of serving as a neutral facilitator. For example, research on the European Galileo program—a flagship initiative of the European space industry involving competitors OHB, Thales Alenia Space, and Airbus Defence and Space—reveals the coopetitive tensions within the project that fueled tensions among the coopetitors (Rouyre et al., 2019).
Each stakeholder suspected the others of being “free riders” or “knowledge hunters,” thereby hindering the sharing of strategic information. To overcome these obstacles, the European Space Agency (ESA) took on the role of a neutral facilitator to centralize knowledge flows, clearly delineate industrial responsibilities, formalize processes, and provide technical coordination. This formal governance helped reduce tensions and ensure the project’s success.
The need to manage coopetition and its tensions highlights two key areas of concern for SCAF. First, the apparent lack of mechanisms suited to managing a coopetitive project (separation of activities, integration of paradoxes, formal and informal mechanisms). Second, the absence of a neutral facilitator between the two co-competitors. Drawing inspiration from the coopetition management mechanisms identified by management science research could offer concrete avenues for better containing these tensions and reinvigorating this highly strategic project for European sovereignty.
Mastering the management of coopetition: a key challenge for the future of European defense
The Scaf project reflects Europe’s dilemmas: the need to cooperate in order to hold its own against the major powers, but also the desire to protect domestic companies.
It shows that one of the major challenges in building a European defense lies in the ability to manage cooperative-competitive projects involving companies and states with divergent interests. Two scenarios are possible. If the SCAF succeeds, it could become a symbol of shared sovereignty and collaborative innovation among European competitors: a model that could be applied to space, artificial intelligence, or cybersecurity. On the other hand, failure would send a worrying signal. It would signify not only the abandonment of a strategic program for Europe, but also a demonstration of the structural limits of the ambition to build a true European defense.
The fundamental challenge is therefore clear: we must learn to manage coopetition at the European level—particularly when it comes to issues of sovereignty—so that it becomes a driver of innovation, rather than allowing it to devolve into a arena of paralyzing rivalries.
Chloé Zanardi, Assistant Professor, TBS Education and Frédéric Le Roy, Professor of Strategic Management – MOMA and Montpellier Business School, University of Montpellier
This article is republished from The Conversation under a Creative Commons license. Readthe original article.