Bloomberg Talks — Leonardo UK's CEO Clive Higgins Talks Europe's Defense Ramp Up

Date: September 11, 2025
Host: Bloomberg Journalist / Interviewer
Guest: Clive Higgins, Chair and CEO, Leonardo UK

Episode Overview

Amid escalating global military tensions—particularly between Europe and Russia—this episode features a timely interview with Leonardo UK's CEO, Clive Higgins. He discusses Europe's surge in defense spending, the UK's evolving strategic priorities, challenges in talent recruitment, and how defense contractors like Leonardo are responding. The conversation is anchored by major recent contracts, the importance of partnerships, and the sector’s workforce and social perception issues.

Key Discussion Points & Insights

1. Global Security Tensions and Europe’s Response

• Rising Instability:
  • “There is increasing tension, there's increasing instability, and that medium term view around significant investment in defense is probably very well understood.” (Clive Higgins, 01:17)
  • Specific reference to Poland’s investments and partnerships with the US and UK.
• UK-Poland Collaboration:
  • Expectation of a “reset” in UK-Polish security and defense relations later in the month.
  • Strong relationships already forming regarding capability requirements.

2. UK's Defense Strategy & Pace of Investment

• Phasing of Government Action:
  • "The government set out... a complete reset, defence transformation, defence reform, but also then setting out that strategic ambition." (Clive Higgins, 02:33)
• Rollout Timeline:
  • Recent release of the Defence Industrial Strategy, with a Defence Investment Plan expected soon to clarify funding flows.
  • Industry needs “money flowing through the system, into the primes, into the SMEs” to maintain supply chain resilience and meet growing requirements. (03:50)
• Industry’s Clear Demand:
  • Government aware of the need for rapid action to support jobs, skills, and capability-building. (04:13)

3. Job Creation & Export Partnerships

• Domestic Employment:
  • "We’ve got 900 graduates and apprentices on our programs today, significant number, 10% of our working population... Global Combat Air program is driving requirements of 400, 500 new heads per annum." (Clive Higgins, 05:05)
• Cautious Optimism:
  • Growth expectations in some divisions, but ongoing uncertainty in others due to uneven contract flow.
• Export Contracts:
  • Over 50% of Leonardo UK’s revenue now comes from exports (£2.6–2.7 billion UK revenue).
  • “We are seeing clarity of that demand signal—contracts flowing through from the US and from European partners as well.” (Clive Higgins, 08:50)
  • Importance of programs like the UK-Norway frigate deal and missile defense with Poland.

4. Talent Pipeline & Societal Perception Challenges

• Skills Shortage:
  • Concerns about recruiting young talent into defense persist, despite new government funding and targeted programs (e.g., “Destination Defence”).
• Public Sentiment:
  • “Universities and academia are still challenged by that volume of anti defense sentiment that's out there... you’ll see a significant protest outside supporting Palestine Action Group and those things.” (Clive Higgins, 07:20)
• Impacts:
  • “If we can attract the skills, the capability, the talent into the business at the time we do it, that delays programs, it's as simple as that.” (Clive Higgins, 08:20)
• ESG Hurdles:
  • Environmental and social governance trends have hampered defense sector SMEs’ access to finance and banking, effecting overall sector resilience. (07:55)

5. European Funding & Industrial Cooperation

• SAFE Fund & Bilateral Initiatives:
  • Of €800 billion discussed for European defense, the bulk (“$650 billion”) is expected to come directly from nation states, with €150 billion from EU institutions.
  • “That’s about having a bilateral with a particular nation and then working together… it might be air missile defense, it could be more frigate programs, it could be land systems.” (Clive Higgins, 09:56)

6. Waste Mitigation and Defence Reform

• Procurement Reform Efforts:
  • New National Armaments Directors Organisation aims to streamline procurement, cutting lead times for simpler and complex programs drastically.
  • “Reducing the time from sometimes five, six years down to one year—that level of ambition is welcomed by everyone… it’s starting to manifest itself with the changes that are coming through.” (Clive Higgins, 10:45)
• European Partnerships:
  • Emphasis on deeper, more consolidated industrial cooperation both within the UK and across European defense sectors. (11:10)

Notable Quotes & Memorable Moments

• On Investment Pace:

  • “If you want to keep the resilience in the supply chain, we need to see some of that coming through now.” (Clive Higgins, 03:50)

• On Talent Challenges:

  • “If more and more youngsters and people don't want to take up opportunities in defence, that's really going to impact our resilience.” (Clive Higgins, 07:45)
  • “There's a correlation between having enough of the right skills to deliver the outputs we need.” (Clive Higgins, 08:20)

• On Export Growth:

  • “Over 50% of our UK revenues is now export ... contracts flowing through from the US and from European partners as well.” (Clive Higgins, 08:50)

• On Procurement Reform:

  • “Reducing the time from sometimes five, six years down to one year—that level of ambition is welcomed by everyone.” (Clive Higgins, 10:50)

Important Timestamps

• 00:57 — Clive Higgins introduced, global military tensions framed
• 01:17 — Rising instability & European defense investment
• 02:33 — How UK defense spending is rolling out; investment plan explained
• 04:13 — Government's response to industry’s urgent calls for funding/action
• 05:05 — Job creation potential and specifics (graduates, apprentices, new hires)
• 07:02 — Challenges attracting young talent; protests and societal sentiment
• 08:20 — Direct link between talent shortages and program delays
• 08:50 — Export market significance and revenue breakdowns
• 09:56 — SAFE Fund, European industrial cooperation, bilateral programs
• 10:45 — Mitigating waste through procurement reform

Overall Tone & Takeaways

• Pragmatic but urgent: Higgins and the interviewers emphasize the urgency of action, both in investment and policy.
• Cautiously optimistic: Growth is real, but obstacles—especially social and labor—remain.
• Emphasis on partnership and reform: Both are seen as vital for resilience and future defense capacity.
• Ongoing societal debate: The sector faces pushback from public and ESG concerns, affecting everything from recruitment to SME financing.

This summary provides an in-depth guide to the episode’s main content, capturing the tone of urgency and complexity while highlighting the intersection between geopolitics, industrial growth, and workforce dynamics in Europe’s defense sector.