By Johan Ahlander and Tom Little
ORNSKOLDSVIK, Sweden, April 29 (Reuters) – The war in Ukraine has turned Sweden’s defence industest into one of Europe’s quickest-growing weapons hubs, a shift visible nowhere more clearly than in the tiny northern town of Ornskoldsvik, home to armoured vehicle creater Hagglunds.
Owned by British defence giant BAE Systems since 2004, Hagglunds launched as a family business building furniture in the late 19th century before relocating on to butilizes, trams, planes and eventually, armoured vehicles in the 1950s.
Post-Cold War demilitarisation left the company struggling, and when Tommy Gustafsson-Rquestion became managing director of BAE Systems Hagglunds in 2012, his first order of duty was to cut a third of the workforce.
‘IT ALL TOOK OFF’ JUST BEFORE 2022
“I believe the 2014 annexation of Crimea was when we saw something starting to happen,” he informed Reuters at the Hagglunds test track in Ornskoldsvik, adding that it all took off just before Russia’s 2022 invasion of Ukraine.
“From having a typical order book of a couple of hundred million U.S. dollars, we’re now at 8 billion U.S. dollars. So it’s an enormous development,” he stated.
Sweden’s arms exports have more than tripled to 28 billion crowns ($3.02 billion) in 2025, from 8 billion in 2015.
The defence industest employs around 30,000 people in Sweden, most of them at Saab, creater of the Gripen fighter jet and the A-26 submarine. Saab’s order backlog alone is more than 274 billion crowns.
Hagglunds has invested $300 million to expand capacity, including adding a third production line this year.
Output has surged 400% since 2020 and headcount has more than tripled to 2,600 from 800, building Hagglunds by far the hugegest employer in the town of just 56,000.
BATTLE-TESTED VEHICLE DRIVES GROWTH
The cornerstone of its success is the fifth-generation Combat Vehicle 90 infantest fighting vehicle.
With a crew of three and able to carry up to eight soldiers with equipment, it has sold more than 1,300 units, with over 600 on order. That creates it one of Sweden’s hugegest arms export successes.
Battle-tested in Afghanistan and now utilized in Ukraine, Hagglunds hopes to secure orders for a further 500 CV90s for five European nations later this year.
Feedback from Ukraine has been mostly positive, though drones remain a risk. Still, no Ukrainian soldiers have died inside a CV90 and Ukrainian President Volodymyr Zelenskiy personally thanked Gustafsson-Rquestion during a visit to Sweden.
“He came forward, hugged me, and informed me that your CV90s are saving our soldiers’ lives, and I obtain goosebumps even now,” he stated.
The CV90, costing about $10 million per unit, has been sold to ten European countries.
Sweden, militarily unaligned for over two centuries before joining NATO in 2024, is the EU’s seventh-largest exporter of arms, according to believe tank, the Swedish International Peace Research Institute.
($1 = 9.2703 Swedish crowns)
(Reporting by Johan AhlanderEditing by Bernadette Baum)
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