To meet rising demand, European aerospace and defense OEMs must tackle four critical challenges to accelerate the delivery of their innovations. Here’s how Celestica can help.
Amidst a challenging geopolitical climate, a shortage of skilled labour, a significant and growing order backlog, and an increasing need to develop and build new products in-region, European aerospace and defense OEMs face unprecedented pressure to accelerate
production and innovation while maintaining strict quality and compliance standards.
While this surge creates exceptional growth opportunities, many OEMs are constrained by legacy designs, limited capacity, and fragmented supply chains — demanding substantial investment to expand capability and keep pace.
With in‑region capability and deep expertise, Celestica understands these challenges — and how to solve them. Today, we help European aerospace and defense OEMs ramp volume production and accelerate the delivery of innovative, mission‑critical solutions.
Challenges and Solutions for European Aerospace and Defense OEMs
Challenge #1: The Inability to Scale Quickly
The ability to scale quickly demands precise processes, readily available capacity, a robust supply chain, and a product that is designed for manufacturing at scale – while maintaining the highest quality, safety and regulatory standards required for
mission-critical products.
Many aerospace and defense OEMs have products that have been in the market for years; however, they were not designed for large-volume production demanded by the current market environment. Performing Design for Manufacturing (DFM) analysis helps optimize
the product design and assembly processes to create a more efficient manufacturing solution, reducing production and test times.
Additionally, adopting a Design for Supply Chain (DfSC) approach is critical for the long-term viability of aerospace and defense products. DfSC integrates obsolescence management, sole sourced suppliers and other supply chain risks directly into the
initial design. This proactive approach – heavily informed by a BOM (Bill of Materials) analysis to identify single-source risks, track component lifecycles, and drive standardization – mitigates the future cost and risk of obsolescence, counterfeit
components, and supply disruptions. By using long-life components, identifying alternate suppliers and standardizing parts identified through this early analysis, DfSC safeguards the readiness and sustainability of aerospace and defense systems.
Finally, the development of sovereign capabilities and fostering domestic innovation is a major focus for aerospace and defense companies across the EU. This requires expanding in-country and in-region production infrastructure. This expansion can be
accelerated by partnering with companies that already possess qualified engineering and manufacturing resources and facilities within the region.
Celestica Solution: In-Region Capacity and Scale
Many European aerospace and defense OEMs are turning to partners like Celestica to help them ramp quickly and cost-effectively. We enable our European customers to draw on the power
of our global footprint, team of industry experts, strong purchasing power and range of end-to-end solutions – from design to volume manufacturing, comprehensive end-of-line testing capabilities, and logistics and after-market support. The wide-ranging
capabilities and deep expertise delivered at our facilities in Europe are supported by an experienced customer support team in Germany and a proven global network.
“Driven by rigorous, proven processes, our strong footprint helps our European customers launch innovative and scalable products and solutions that meet stringent industry standards,” says Matt McKinley, Vice President, Aerospace & Defense, Celestica.
“Our EU facilities, with world-class quality, reliability, delivery, regulatory compliance, and IP safeguards, help EU aerospace and defense primes quickly establish in-region production solutions that reduce costs and deliver programs on time.”
Challenge #2: Doing More with Constrained Engineering Resources
European aerospace and defense companies are being challenged to produce significantly more product, with increased complexity, amid a highly constrained labour market.
Challenges driving increased need for engineering expertise across the EU include:
- Differing national requirements / variants resulting in increased engineering complexity.
- Major new multi-national programs requiring OEMs to coordinate work, agree on standards and ensure interoperability.
- With a massive proliferation of new sovereign systems being developed across all platforms (UAVs, land vehicles, sensors, etc.), the opportunities for growth are greater than ever, but they are limited by finite engineering capacity.
- Given the decades-long lifespan of aerospace and defense products, obsolescence management demands significant resources. Part swaps in certified products require re-qualification, while long product development cycles hamper the quick integration
of new and emerging technologies such as AI.
Celestica Solution: Extend your Engineering Team
By leveraging Celestica’s design assist and product redesign/optimization capabilities, aerospace and defense companies can strategically reallocate their internal engineering teams to concentrate solely on next-generation programs and drive growth.
“We pair local execution with holistic global engineering solutions to help accelerate program time-to-market. We also leverage our global network of engineering talent -- a broader team of experts who can help lower costs and accelerate products from
development to manufacturing while balancing cost, quality and on-time delivery,” says Sebastian Ehrenreich, Principal Design Engineer, Aerospace & Defense, Celestica.
Examples include: design assist and product development; conducting comprehensive design for manufacturing (DFM) analyses to provide more efficient and effective manufacturing and test solutions at scale; effectively introducing emerging technologies;
running verification and validation campaigns to ensure long-running products not only stay on the market but also generate value; and leveraging our strong global supply chain to select alternate parts to manage obsolescence and reduce cost.
Challenge #3: Navigating the Complex Regulatory Environment
For the aerospace and defense industry, navigating strict regulations, including export controls and data safeguarding can be complex and labour-intensive – especially for smaller companies. OEMs need in-region experts who can help them manage regulatory
compliance efficiently.
Celestica Solution: Work with a Proven Partner
Celestica's proven regulatory expertise across EU Defense and UK Export Control frameworks includes extensive U.S. ITAR/EAR expertise within the EU region. Our in-region compliance teams also provide the high-level oversight necessary to navigate the
EU Common Military List and the UK Export Control Order 2008, ensuring that complex programs maintain momentum.
Furthermore, Celestica’s European-based design and manufacturing ecosystem offers a strategic advantage for dual-use technology. By operating directly within the EU Dual Use Regulation 2021/821 framework, we provide a seamless, localized solution that
simplifies the supply chain and clears the path for program execution.
Challenge #4: Highly Fragmented Supply Chains
Lastly, aerospace and defense OEMs face a lack of unified, scaled supply chain partners in Europe. Frequent reliance on domestic suppliers can create a patchwork of fragmented Tier-2 and Tier-3 supply networks that often lack the scale and coordination
to handle large, pan-European orders.
Many OEMs in the industry are generally geared toward lower volume production, with insufficient surge capacity to handle sudden increases in demand. Fragmentation discourages long-term investment in scalable production lines. Some OEMs also lack the
scale to drive supply chain improvements in constrained environments, or the engineering talent to solve complex problems. Additionally, lack of robust compliance and IT systems needed to protect customer IP can also be a challenge.
Celestica Solution: Driving Supply Chain Resilience
Celestica's global supply chain network directly combats the fragmentation in the European aerospace and defense market by providing economies of scale and enhanced resilience. Its global/local footprint offers the regional compliance required by defense
OEMs while maintaining scalable capacity worldwide to ensure production continuity during disruptions. The network incorporates advanced risk management, utilizing predictive analytics to proactively manage elements that cause disruptions and providing
strict traceability systems, safeguarding the long-term viability and readiness of defense platforms against supply chain failure and component end-of-life.
Many companies are unable to scale from low to high volumes, and only focus on either engineering or manufacturing – separating key disciplines, overlooking important synergies and adding complexity through multiple interfaces. This leads to inefficiencies,
higher costs and slower product delivery.
To scale products with an extended service life, it’s critical for aerospace and defense OEMs to have a full product lifecycle partner capable of doing it all, well.
Celestica’s integrated manufacturing and engineering teams work together to proactively address challenges – preventing operational delays and costly disruptions.
Celestica: A Trusted Full Product Lifecycle Partner in Europe
With high demand, a talent shortage and rapidly emerging technologies, it’s a challenging time, but also one of tremendous opportunity for aerospace and defense OEMs in Europe. There is no need to go it alone.
Celestica is a partner that enables customers to rapidly scale – offering access to highly skilled global engineering and manufacturing teams, extensive global purchasing power, and resilient supply chain networks – so OEMs can turn high demand into significant
growth opportunities.
Ready to accelerate your mission-critical programs and enhance scalability?
To learn more, connect with members of our Europe Sales team today at: eu_defence@celestica.com.