Euro Area Industry: Defense Output Rises as Vehicle Production Falls

Production of military fighting vehicles in the euro area reached an index level of 259.1 in July 2026 (2021 = 100), according to Eurostat. That is 51.3% above July 2025 and the highest monthly level since at least 2016. For January to July, output was 27.4% higher than a year earlier.

Euro-area motor vehicle production fell 9.6% from a year earlier in July, to an index level of 98.0, the lowest since April 2022. Production of parts and accessories was down 7.1% and automotive electrical and electronic equipment down 4.2%. For January to July, motor vehicle output was 5.7% below the same period of 2025.

Total manufacturing output was 0.7% lower than a year earlier, while computer, electronic and optical products rose 18.5%. Defense is a much smaller industry than automotive, so the chart compares growth rates, not size. For electronics suppliers in Europe, defense and electronics demand is growing while automotive demand is declining.

Business Outlook tracks electronics, automotive, solar and global economic data in several hundred charts, updated monthly. Contact jon@custerconsulting for more information. 

Source: Eurostat, industrial production (sts_inpr_m), euro area (EA20), seasonally and calendar adjusted, index 2021 = 100, data to July 2026 (Eurostat update of 17 September 2026). Year-on-year and year-to-date changes computed by Custer Contexo Group. The latest month is subject to revision; recent motor-vehicle, parts and automotive-electronics values include Eurostat imputations.