The European Defence Fund (EDF) plans to allocate €1 billion ($1.2 billion) for defence research and development in 2026, with the largest share of funding directed toward air and missile defence, including efforts to counter hypersonic glide vehicles, the European Commission said.
According to the EDF’s annual work programme published on Wednesday, €168 million has been earmarked specifically for hypersonic countermeasures and high-end endo-atmospheric interception, reflecting growing concern in Europe over next-generation missile threats.
Another major priority is ground combat, with €150 million allocated to research on future main battle tank (MBT) platforms and a multiple rocket launcher system.
Strengthening Europe’s Defence Base
Established in 2021, the EDF supports collaborative defence R&D among EU member states. Since its launch, the fund has invested nearly €4 billion across more than 200 projects, targeting capability gaps and complex technologies that individual countries would struggle to develop alone.
Notable EDF-backed initiatives include Odin’s Eye II, a satellite-based early-warning system, and multiple projects related to hypersonic defence.
“Europe must strengthen collaboration in defence, with the European Defence Fund acting as a key foundation for this effort,” said European Commissioner for Defence and Space Andrius Kubilius. “For the sixth time, we are investing significant resources to support research and development on major defence capabilities.”
Budget Priorities for 2026
The Commission said half of the EDF’s 2026 budget will be dedicated to major defence capabilities, including:
- An EU endo-atmospheric interceptor
- A future main battle tank
- A multiple rocket launcher
- Key technologies for next-generation combat aircraft
Around 25% of the budget will be allocated to future defence technologies, such as quantum-secured communications, artificial intelligence, and robotic and drone swarms.
Tanks, Interceptors and Hypersonic Defence
The EDF has set aside €125 million to develop next-generation MBT systems with improved survivability, enhanced firepower, reduced crew requirements and eventual unmanned operation. The Commission noted that Europe’s current tank fleets are aging, making new technologies essential to maintain a military edge.
A further €100 million will support high-end endo-atmospheric interception, advancing interceptor technologies to higher readiness levels and developing demonstrators covering airframes, propulsion and lethality.
In addition, the EDF will directly award an indicative €68 million, without a new call for proposals, to continue work on a hypersonic glide vehicle demonstrator. The programme, subject to EU secrecy rules, involves companies including MBDA, Airbus, Diehl, Hensoldt, Kongsberg, Indra Sistemas and Saab.
Naval and Aerospace Technologies
The 2026 work programme also includes €90 million to design and prototype medium-sized, semi-autonomous surface vessels for coastal defence, with adaptability for future naval warfare roles.
Additional funding — typically ranging from €20 million to €30 million per project — will support technologies such as:
- A turbofan engine for unmanned “loyal wingman” aircraft
- Radar systems to track hypersonic vehicles
- Automated air-to-air refuelling
- AI-enabled electronic warfare
- Advanced multiple rocket launcher concepts
Challenges Ahead
While the EDF has helped reduce duplication and improve cross-border cooperation, an interim evaluation by the European Parliamentary Research Service published in October said the fund needs simplified procedures and closer alignment with national defence planning to maximise its impact.
The 2026 funding plan underscores the EU’s growing focus on high-end military technologies as Europe accelerates efforts to strengthen its defence posture amid an increasingly contested security environment.
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