Eurosatory 2024 – Interview of Lorenzo MARIANI from LEONARDO

Very well, thank you. I'm great.

So far, so good, very busy.

Definitely the environment has changed dramatically in the last two years. A lot of conflicts, not all of them well known. However, the lessons learned are several. For sure, the use of conventional means such as artillery, infantry, coupled with asymmetric threats and very high technology threats. I'm thinking about hypersonic. These have called for a very quick change in requirements for our systems and a very deep evolution of our systems, mostly across two lines, I would say. One is the multi-domain response. We believe really that more and more our systems must be capable of operating not only in a single domain such as land, sea, air, or even space, but all of them together. The second one is a very dramatic digitalization with a growing impact from cyber, and of course with digitization, with connectivity, also a lot of big data and artificial intelligence application. This is the kind of evolution that we have perceived from the market, from the requirements of our customers, and the kind of evolution that internally we are providing to our systems to respond to this.

I think this is a very good question. We are showing here at Eurosatory our new escort helicopter, the AW249, that is a helicopter that was born for multi-domain operational, so with an open architecture, all digitalized equipment. And this is really a good example on how we should respond in the future to multi-domain operational requirements. In addition, of course, this will have an impact on all the equipment that we produce and normally we put on board, for example on future generation tanks, trucks, and wheeled vehicles. All of that should be digitalized, all of that should be capable of integrating and being added with new features in a very quick and reactive way, while the threats are changing. Because as they changed very quickly in the last few months, they could change again in the future, and we have to be ready for that.

Of course, of course. We are setting up all our industrial plan along a few lines. One of those is the multi-domain approach, so we are creating a specific working group internally in order to develop the involved technologies, to develop the competencies in our staff, and to work together with customers in order to understand what is the impact of those requirements on existing platforms and on future ones. At the same time, we are performing a very strong effort on digitalizing all of our equipment, our company, not only the products but also all the production means, the engineering features of our company. And this will bring the need, is already bringing the need for a coverage of cyber protection. We have a specific division of cyber who provides both services outside and secure-by-design feature to our internal elements, products, and systems. And I think those two lines, coupled with the effort we are paying on space, creating a specific space division, will pay absolutely a good price in the future, as space will be central to all connectivity and multi-domain operations.

Absolutely, absolutely. Those are two key elements.

This is a very important topic, you're right, and I'm very involved in that, both through MBDA, that I always define the best JV in the defense in Europe, probably also one of the few, and with the traditional Oto Melara brand that we embed in our Leonardo electronic division that produces ammunition rounds of different calibers. One of the lessons learned that we got from the recent conflicts is important use of those ammunition and missiles, and probably also a not sufficient stockpile of that. The reaction of course has been to set up proper lines. And I would say that difficulties are currently being tackled, but can be envisaged in two or three areas. One is for sure the supply chain. The supply chain is often constituted by small and medium enterprises that do not have enough capability to resist to long periods of low production, so when it is about ramping up, they need investment, they need planning, because sometimes even with an upfront investment, you need nevertheless to show that there is a planning along the years to come, otherwise we might be in difficulty again in three, four years from now. Another point is for sure duplicating lines of production, but this is something that I think that is really the job of companies like Leonardo, so we are doing ourselves and with our partners, namely in MBDA. There is also a topic of upgrading our staff in terms of numbers, but this is something we have been starting already since a few years ago. And so I think, of course, STEM availability is low in Europe, nevertheless this is affecting more developments of new technologies than real establishment of new production capabilities. The digitalization is another cross element of that, but I think this is now pervading the full spectrum of companies, and any new production line is fully digitalized. And again, the real key element is to transfer this in a seamless way to the supply chain.

I will add one last point for all. What is the future capabilities? A key element will be the capability to cooperate inside Europe. Of course, this is from developing the new technologies together so to accelerate time scales, availability, and to reduce the burden of funding for each one. And at the same time, also to share some production capabilities so that everyone can specialize maybe or complement the need whenever this is requested.