Charles Esther
Saab’s CEO, Micael Johansson, revealed on Friday that while skilled manufacturing workers remain essential in the defense sector, companies will increasingly seek AI and data engineers.
Johansson spoke to Business Insider about the shifting priorities in the defense industry, emphasizing the rising importance of software expertise.
Shift Toward Software-Defined Systems
According to Johansson, the defense business is evolving toward a model focused on software-defined systems, making AI engineers, software developers, and data specialists highly sought after.
Saab, known for producing the Gripen fighter aircraft, recently expanded its workforce by 6,000 employees during a period of rapid growth.
Continued Need for Skilled Production Workers
Despite this shift toward software, Johansson noted that technical roles such as welders and mechanics remain critical.
He explained that the company still requires skilled production workers to build complex weapons platforms, including submarines, where expertise is difficult to find.
Live Service Business Model
Johansson described the industry’s move toward a “live service” business model.
This model relies on weapons systems that can be updated incrementally and connected with other platforms through software enhancements.
Impact of the Ukraine Conflict on Technology Development
The urgency of this shift was highlighted by developments in the Ukraine conflict, where rapid advancements in drone technology and countermeasures have occurred within weeks.
“The technology will grow so quickly, so you cannot buy a sort of, 50,000 drones and put them in stock,” Johansson said.
He described a vision of “drones as a service,” where systems are flexible and continuously updated rather than statically deployed.
Saab’s Growth and Financial Performance
Saab, the largest defense manufacturer in the Nordic region, has seen booming demand since the outbreak of war in Ukraine.
The company reported 2024 annual sales of 63.75 billion Swedish krona (about $6.6 billion), a significant rise from 39.15 billion krona in 2021.
Saab’s share price surged by over 120% since early 2017, reflecting investor confidence amid geopolitical uncertainty, especially regarding NATO’s future.
Workforce Expansion to Meet Demand
Johansson shared that Saab’s workforce grew from 19,000 to 25,000 employees in just two years to meet increasing demand.
The company attracted over 200,000 job applicants last year, with 74,000 applying in the first quarter of this year alone.
Initially, Saab planned to hire 1,000 new staff in Sweden in 2024 but raised this target to 2,000 after already hiring 900 in the first quarter.
Johansson acknowledged that even this updated forecast might be exceeded due to the rapidly expanding business.
Industry Trends and Future Outlook
The transition at Saab signals a broader trend across the defense industry where AI and software capabilities are becoming as vital as traditional manufacturing skills.
As software-defined systems become the norm, the demand for engineers specializing in AI, data, and software development will only intensify.
This evolution underscores a changing landscape where innovation and adaptability are key to national security and defense technology.
