Aerospace and Defence Cluster Exports 92 Per Cent of What It Produces as Sector Employs 20,000 Across 180 Entities

Portugal's aerospace, space, and defence industries exported 92 per cent of their combined output in 2024, generating a total business volume of EUR 2.1 billion and employing roughly 20,000 people across some 180 entities, according to the president of the AED Cluster.

José Neves, who leads the industry body that brings together companies, universities, and research centres working in aeronautics, space, and defence, told Lusa the sector is projecting at least 10 per cent growth in 2025 and described the export orientation as a defining feature of Portugal's industrial base in these fields.

A Sector Built on Exports

“Ninety-two per cent of what is produced in the aerospace and defence sectors is exported,” Neves said, highlighting that Portugal's contribution to global aviation manufacturing is far larger than most people realise.

“Every aircraft made by Embraer, Airbus, and Boeing carries components or parts manufactured in Portugal,” he added. The country's primary export markets are Brazil — largely because of the Embraer supply chain — followed by Spain, France, and Germany.

The AED Cluster currently integrates approximately 180 entities, spanning the full value chain from raw-material suppliers and precision-machining firms to satellite manufacturers and university research laboratories.

From Components to Satellites

Neves emphasised how far the sector has come in a relatively short time. “We are manufacturing satellites and satellite launchers today — something unimaginable perhaps ten years ago,” he said.

While the cluster's export volume is overwhelmingly concentrated in civil aeronautics components, the defence share remains modest. Defence-related exports currently account for less than one per cent of Portugal's total exports, according to Neves, though he projected this could rise to two or three per cent within the next decade as European defence spending accelerates.

NATO Spending and European Rearmament

The growth projection comes at a time when NATO allies are under intensifying pressure to raise defence budgets toward the Alliance's two-per-cent-of-GDP guideline. Portugal's defence spending has historically sat below that threshold, but the government has signalled a commitment to increasing it in the coming years, in line with broader European rearmament trends driven by the wars in Ukraine and the Middle East.

For Portugal's aerospace and defence companies, rising European procurement budgets represent a significant opportunity. The AED Cluster has emphasised the need for closer collaboration between industry, the Armed Forces, and the government to ensure Portuguese firms capture a larger share of domestic and European defence contracts, rather than relying almost exclusively on civil aviation exports.

Context: A Quiet Industrial Powerhouse

Portugal's aerospace sector is often overshadowed by better-known industries such as automotive (anchored by Volkswagen Autoeuropa in Palmela), tourism, and textiles. Yet the EUR 2.1 billion turnover figure places it among the country's most productive export-oriented clusters.

Major international firms with manufacturing operations in Portugal include Embraer (in Évora), which produces composite structures and metallic aerostructures, and a network of smaller suppliers that feed into Airbus and Boeing supply chains. The space segment has grown rapidly, with Portuguese companies now involved in satellite design, Earth observation systems, and launch vehicle components.

The 20,000 jobs across the cluster are typically high-skilled and high-wage positions, making the sector a key target for Portugal's efforts to move up the value chain and reduce its historical dependence on low-cost labour-intensive industries.