"I think this is bad news, very worrying for Europe and for Europe's strategic autonomy," she said, adding: "the interests of industry have been placed ahead of the interests of Europe's security and defence."

Berlin and Paris agreed on Monday to ditch the Future Combat Air System (FCAS) programme that was seen as a key test of European efforts to work together in the face of a hostile Russia.

The multi-billion-dollar programme was beset by disagreements between the firms involved -- France's Dassault Aviation and Airbus, which represents Germany and Spain.

A German government official told AFP on Monday that Chancellor Friedrich Merz and French President Emmanuel Macron had "reached the shared assessment that the companies will not be able to come together on building a joint combat aircraft".

The news comes despite calls for Europe to integrate its fragmented militaries more closely as geopolitical turmoil worsens.

Russia's war against Ukraine is in its fifth year, while European countries are increasingly worried about US security commitments to the continent under President Donald Trump.

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Dassault Aviation

Airbus Group