Decoded No. 21: Defence Boom, Factory Bottlenecks (full note, PDF)

Decoded, analysis note No. 21. Driss EFFINA, PhD. October 2026. PDF, 27 pages, 14 charts and diagrams, 8 tables.

Western defence money is arriving faster than Western defence factories can absorb it. In 2026 Germany is budgeting 47.9 billion euros for military procurement and plans 55.8 billion for 2027; France has 126.5 billion euros of commitments it has signed but not yet paid; the United Kingdom’s capital budget for defence rises by 30 percent over four years; the United States has asked Congress for 70.5 billion dollars for munitions in fiscal year 2027, almost three times the 2026 amount; and Canada wants 70 percent of its purchases to go to domestic firms whose revenues would have to grow by 13 percent a year for a decade. This note asks whether the money can be turned into equipment, and at what price.

Inside the full note:

• The money: budgets, approvals and commitments
• The order books: nine groups, one queue
• How long is the queue? An orders-to-capacity gap model
• Absorption: how much of the extra money becomes output?
• The bottleneck heatmap
• Lead times and the instruments meant to shorten them
• The growth contribution of defence output
• Scenarios to 2030
• A dashboard of leading indicators
• Implications for policy, investors and suppliers
• What to watch

Read the free preview: Defence Boom, Factory Bottlenecks.