Jesús Sánchez Bargos has headed the Spanish division of the French multinational Thales for 11 years. With a workforce of 1,800 employees that will remain at 1,100 this year after the total sale of the transportation area to Hitachi. The goal is to focus on the defense business. The company closed 2023 with an order book of 300 million. His roadmap involves implementing synergies in the sector to move towards true defense of Europe.
What is Thales and where is it going?
It is the European technological leader, both in defense and digital security, which has a very clear strategy: use its capabilities to reuse them in the civil and military sphere. After covid we have seen growth in the aerospace and aeronautics area. We are now developing products with the coming decades in mind.
How was 2023 in Spain?
We consider ourselves a Spanish multinational because from here we export to other countries with products and technology made in Spain, relying on the Thales portfolio. We promoted the defense area, companies have been purchased and the transportation part has been sold. In the end we have a catalog of capabilities and solutions that gives us an advantage in the national market. We are in a relevant and attractive position.
What are your main military projects?
We are a very relevant player in everything related to command and control systems and tactical communications. It is the main bet in Spain and clients consider us a reference. Now we are trying to have more clients, evolving the solutions. For example, we are the supplier of PR4G radios and we are perfecting them. We try to position ourselves as the reference technological partner for Spanish companies. We have signed a contract with India, in collaboration with Oesia. How do we make the best use of the financial resources we have? All European countries cannot develop all technologies from scratch because they would need unlimited budgets. What can Thales offer? Interoperability.
More agreements between companies?
If we want to move towards European defense we must reach agreements and unions between companies. Thales can complement the national industry to be able to have national products with the required sovereignty. That’s the goal and that’s where we are on defense.
What situation is the European defense industry in?
We have to think in a European key. There is a consensus among companies to join together. How and when do we arrive? That is the most controversial point and there may be different opinions on it. It is good to know where we come from, from a stage in which investments were very limited and that has conditioned the ability to develop joint systems. Now we find ourselves in another situation. But what is Europe’s dependence on purchases of non-European products? We buy approximately 80% outside Europe. Point one: you have to invest in your own developments. Point two: we continue buying products from countries outside Europe, but let’s buy from countries that are at least NATO. I think this deserves reflection. Does it make sense to continue buying products that you don’t have in your country? Yes, because you don’t have them. But at least buy them in Europe. That is what worries me, because we continue to see purchases that someone should really ask themselves the question: couldn’t this thing that has been bought outside of Europe and outside of NATO, could it have been bought in Europe even if it costs a little more? I am concerned that the short-term strategy is not consistent with the long-term one.
Do you see jealousy between companies and countries?
I think it is seen in all countries. Deep down we are European, but first we are national. So, if I can have it at the national level, I prefer to have it rather than at the European level. Why would I entrust my security to another country in Europe? That’s where the paradigm shift is. We have to trust in what we have built together, which is Europe. We are going to trust that we defend ourselves together.
What synergies does Thales have with Spanish companies?
We have a quite varied format. In defense we started with a joint venture with Amper. We have established shared companies, with Navantia and the sonars of the F110 frigates. Also with Indra. Thales is a technology partner in these companies. We still have Thales Alenia Space, shared with Leonardo. We have a flexible model to adapt to the context and local requirements. We are collaborating with Telefónica for a new command and control system for the Army. We are flexible. We provide knowledge and that is very good for the local industry and national capabilities. For me that is achieving a level of excellence in the model that gives a lot of added value.
Will they acquire more assets in Spain?
In defense we have the main capabilities. We want to grow in digital security because it is a business that is increasing at a significant rate. We have invested a lot in cybersecurity and we want to position ourselves as one of the main players on a global scale. In Spain we bought S21sec and Gemalto. Yes, everything that has to do with this field could be of interest to Thales.
Also Minsait, from Indra?
It is not a goal at the moment for Thales.
They work with the main Spanish banks.
In Barcelona we have a credit card personalization center. We work with CaixaBank, Santander and BBVA. We also work on everything that has to do with digital banking, we provide cybersecurity services for banks. It is an important sector for us.
Do you have labor problems?
It is a widespread problem. The time it takes to source and recruit high-value people is increasing, probably because demand is greater than supply and there is currently a war for talent in all European countries. Spain is no exception.
What would happen in the defense industry if there is a change of government in the United States in November?
I don’t think I’m the best person to assess it, but everyone has some uncertainty and some concern that someone will arrive who can set new demands on the NATO countries.
