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The chief executive of Europe’s largest shipbuilder, Fincantieri, has called on European countries to scale up their underwater defence capabilities amid rising threats and the retreat of the US.
“The Mediterranean has always been populated by Russian and US submarines, it’s up to us Europeans now to take responsibility for our underwater defence,” Pierroberto Folgiero told the Financial Times.
“If European countries are going to spend more on defence, we should spend better,” he added.
The Italian state-controlled shipbuilder announced last week that it expects its underwater division, which focuses on submarines, communication systems and autonomous vehicles, to double in size over the next two years reaching €820mn in revenue in 2027, equivalent to 8 per cent of the group’s current revenue.
It expects the global underwater economy to grow by €50bn a year as countries invest more in underwater defence and security.
Following the 2022 attack on the Nord Stream pipeline, governments have been scaling up underwater defence capabilities such as unmanned drone systems and anti-submarine technology.
Folgiero said the threat of attacks on subsea cables and other critical marine infrastructure was likely to increase and demand for technology and infrastructure that could prevent or minimise the impact of attacks would rise significantly.
“Attention has focused on the Baltic Sea following the outbreak of the war in Ukraine, but the Mediterranean is twice as big as the Baltic and a crucial juncture from a geopolitical perspective,” he said.
“This is why we are betting on underwater defence and technology and increasing our industrial capabilities.”
Fincantieri’s share price rose about 20 per cent last week to €15 a share after it said it would expand its underwater division.
It also announced a partnership with Graal Tech, an Italian technology group, to develop autonomous underwater vehicles.
Antonio Gianfrancesco, an analyst at investment bank Intermonte, said that “underwater is one of the key medium-to-long-term catalysts for [Finacantieri’s] equity story”.
Last year the company, which specialises in both military and civil shipbuilding, announced a €415mn deal with defence group Leonardo to take over its WASS submarine division. In 2023, it bought Remazel, an Italian engineering company focused on offshore equipment manufacturing.
Fincantieri, which failed in its 2020 merger attempt with France’s Chantiers de L’Atlantique amid opposition in France and EU competition concerns, has experienced strong growth since the pandemic. It has shipyards across the world, including in the US, and has had a surge in global orders.
Last week it said its earnings in the first quarter of 2025 rose 35 per cent to €2.37bn compared with last year. The value of its order backlog reached a record €57.6bn or seven times its 2024 yearly revenues.