Interview: Norway’s defence surge tests capacity

Norway’s defence industry has expanded rapidly in recent years.

That trajectory is expected to continue, but structural constraints are emerging, says Torleiv Opland, chief executive of Norwegian Defence and Security Industries (FSI).

- Things have moved quickly over the last few years, he says.

In 2024, turnover in Norway’s defence sector reached NOK 46 billion, of which approximately 80 percent came from foreign customers. 

Final figures for 2025 are not yet available, but preliminary estimates indicate growth of around 30 percent, corresponding to roughly NOK 60 billion, or about 5.4 billion euro.

- The industry is growing significantly, driven by a number of large investments, Opland says.

Account for 30 percent

As part of a wider survey, Defence Nordic asked industry leaders in Denmark, Finland, Norway and Sweden to assess the strength of the region’s defence industrial base and the potential for deeper Nordic cooperation. 

Recent interviews included Joachim Finkielman of Denmark’s National Defence Industry Association and Tuija Karanko, secretary general of the Finnish Defence and Aerospace Industries (PIA).

In Norway, growth is delivered by more than 300 FSI member companies, Opland explains. 

The sector spans major prime contractors such as Kongsberg and Nammo as well as small and medium-sized enterprises, start-ups and micro-businesses. SMEs account for approximately 30 percent of Norway’s defence exports.

However, the expansion brings significant strain and across the value chain, companies are struggling to keep pace with demand. 

Labour availability is a concern, though the sector has been relatively successful in attracting talent also from Norway’s energy industry, where activity in oil and gas is expected to slow dow.

- There is an urgent need to increase production capacity. Demand is very high and is likely to remain so for the coming years, Opdal says.

Burdensome

A more structural constraint lies in what he describes as a burdensome approval regime for new construction and capacity expansion, combined with limited access to electrical power for production facilities.

- Very little new energy capacity has been built for years. That creates problems in securing sufficient power. This affects the entire value chain, not least subcontractors, Opland says.

As one example, Opland points to Nammo, which produces tactical propulsion systems, including rocket motors for missiles and smaller rocket systems. 

- The war in Ukraine has led to a sharp increase in missile consumption. Despite substantial investment, scaling production remains challenging, he says, adding that longer-term contracts would provide greater predictability for suppliers.

Like his Danish and Finnish counterparts, Opland sees clear opportunities for stronger Nordic cooperation. 

He is cautious, however, about the scope for major joint procurement programmes. Many large contracts have already been signed, and national industrial interests may limit political ambitions for deeper integration, he argues.

- There is potential to expand joint procurement in smaller projects and through the acquisition of common equipment, enabling shared maintenance arrangements, particularly after Sweden and Finland joined Nato, he says.

He also highlights the F-35 programme as an area where Norway, Finland and Denmark could explore closer cooperation, though he acknowledges that progress will not be straightforward.

Untapped potential

According to Opland, there is an untapped potential among Nordic SMEs and in collaborative research and development.

- There are many innovative SMEs across the Nordics. To compete internationally, a number of them will need to partner and scale together. We see this happing but there is potential for further collaboration, he says.

While examples of cooperation exist, he believes there is scope for more. 

A recent defence industry conference between Norway and Sweden, the first in a decade, signals renewed interest.

- It is up to companies to build networks and identify Nordic opportunities for cooperation. The opportunities are certainly there, Torleiv Opland says.