The war in Ukraine has laid bare a grim reality: Europe’s ability to produce its own ammunition is dangerously limited. For decades, NATO allies relied heavily on the United States for strategic procurement, but shifting geopolitical sands demand a new approach. Enter Sweden Ballistics — or Swebal — a startup that has raised €30 million from former army chief Karl Engelbrektson and EQT co-founder Thomas von Koch to build the first new TNT plant in Europe since the Cold War.

The Munitions Gap

Europe’s defense industrial base has atrophied since the 1990s. According to a 2024 NATO report, the continent’s ammunition production capacity meets only 30% of its wartime requirements. Artillery shell production, in particular, has been a bottleneck. Existing producers like Poland’s Nitro-Chem cannot keep up with demand, as they rely on outdated infrastructure and struggle with raw material shortages. Swebal’s plant, with a planned annual capacity of 4,000 tonnes of TNT, aims to fill a critical gap in the supply chain for 155mm shells, aerial bombs, and drone warheads.

Investor Confidence

The backing from Engelbrektson and von Koch signals a shift: former military leaders and top venture capitalists are betting on hardware-heavy manufacturing. “We are not just investing in a company; we are investing in Europe’s strategic autonomy,” Engelbrektson said in a press release. The €30 million seed round is one of the largest for a defense manufacturing startup in Europe, underscoring the urgency. The investors are betting that Swebal can accelerate production timelines — shaving years off traditional procurement cycles that often span a decade.

This is part of a broader trend. Across Europe, startups are emerging in autonomous systems, electronic warfare, and hypersonic technologies. However, munitions manufacturing is distinctly unfashionable: it involves heavy infrastructure, environmental regulations, and long lead times. Yet, the sheer demand makes it attractive. The European Union has pledged to procure 1 million artillery shells by the end of 2025, and the NATO stockpile requirement stands at 30 days of intense conflict — a goal that remains elusive.

Regulatory and Ethical Challenges

Privatizing the defense supply chain raises questions. How do startups balance profit with strategic necessity? Swebal’s plant will be subject to strict EU chemical regulations and environmental impact assessments. The company has stated it will use green energy and modern filtration to minimize pollution. Still, the ethical implications are debated: some argue that private companies should not control munitions production, while others say only private agility can meet the pace of modern warfare.

Historically, Europe’s last TNT plant built from scratch was in the 1980s in the UK. After the Cold War, production lines were mothballed or dismantled. In 2014, following Russia’s annexation of Crimea, some capacity was revived, but it was insufficient. The current crisis echoes the 1930s rearmament, when private industry rapidly scaled up. However, the difference today is that defense tech startups are leveraging digital tools and modular designs to reduce costs. Swebal’s approach is reminiscent of how SpaceX disrupted aerospace: by using modern manufacturing techniques and agile product development.

In conclusion, the resurgence of European defense manufacturing is a testament to the power of entrepreneurial adaptation. Swebal’s new TNT plant may not be as glamorous as a drone swarm, but it is arguably more foundational. As NATO secretary general Jens Stoltenberg recently remarked, “Ammunition is the currency of war.” Europe is now minting its own.