€3.7bn Swedish frigate deal goes to Naval Group as Europe’s naval arms race intensifies
Sweden has selected France’s state-owned Naval Group to manufacture four warships worth around Skr40bn (€3.7bn), beating out the UK’s Babcock International as the Scandinavian country seeks to rapidly bolster its defence capabilities.
Naval Group beat out a competing joint bid from Babcock International and Sweden’s Saab, as well as a separate one from Spain’s Navantia.
The decision is a blow to Babcock and domestic champion Saab since they had been seen as strong contenders, with the UK government targeting increasing defence exports.
Babcock’s Type 31 frigates are still under construction for the British Royal Navy and have not yet deployed, while Naval Group’s FDI frigates are already operated by both France and Greece.
Swedish defence minister Pål Jonson said that Naval Group’s promises for “quick delivery” of a “proven system” for its FDI frigates had influenced the decision.
Given that France and Greece were already using the new frigates there was also the possibility of “cost sharing”, he added, without specifying details.
The new warships will be larger and more capable than previous generations since they can also defend against fighter jets and shoot down ballistic missiles. Naval Group has increased the production pace of the FDI frigate to two per year, with manufacturing based in the Lorient shipyard in Brittany.
BAE Systems beat out rivals from France, Germany and Italy last year to supply Type 26 frigates to Norway in a contract that the British government said would be worth £10bn, its largest ever warship export deal.
Denmark is also looking to acquire new frigates from a similar cast of companies, and is expected to decide later this year, according to one person familiar with the discussions. Denmark has held advanced talks with Babcock, the FT previously reported.
The new frigates would help Sweden to undertake missions beyond the Baltic to patrol the North Sea, the Mediterranean and the Red Sea, including under the leadership of Nato, which it joined in 2024.
President Emmanuel Macron thanked Sweden for selecting Naval Group and made the link to how France had in January chosen Saab’s GlobalEye surveillance aircraft to equip its own air force.
“This is a strategic decision of great significance that reflects the mutual trust between our two countries,” he said.
France had pitched the naval contract as part of broader defence co-operation aimed at building up European capabilities and slowly reducing reliance on US-made weapons. Paris and Stockholm signed a defence road map in June 2025 that they said could lead to joint projects or contracts on anti-tank missiles, air defences and naval assets among others.
Sweden was also one of the seven countries that agreed in March to join discussions with France over how its nuclear arsenal could be used to protect Europe under Macron’s new idea for so-called “forward deterrence”.
France is the world’s second-largest arms exporter after the US.
The French government is also buying other weaponry from Sweden. The DGA, France’s defence procurement agency, announced on Monday that it was ordering eight vehicle-mounted radar systems made by Swedish companies Saab and Scania, in addition to another eight ordered in December.
In the interest of speed and given “the absence of an immediately available French solution”, the DGA said in a statement that it “opted for an off-the-shelf acquisition from two Swedish industrial partners”.
Exports now make up about one third of Naval Group’s sales, but its most important mission for France remains producing submarines and naval assets for the country’s independent nuclear programme.
“Naval Group is fully mobilised for a rapid delivery of the first rank frigate, combat ready,” the company said in a statement.
Head of Investigations
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