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ConceptVersie: 0.9Datum: 2025-10

Surge Capacity — Scale-up Capability

Definition​

Surge Capacity = the ability to 10x production within Time-to-surge: ≤ 6 weeks.

Why critical?

  • Modern conflict escalates faster than industrial production can scale (Ukraine lessons)
  • Peacetime numbers are not relevant — surge capacity is
  • Time-to-surge is more important than inventory levels

Time-to-Surge as KPI​

Old thinking: "How many platforms do we have in stock?" New thinking: "How quickly can we 10x production?"

Benchmark: Ukraine Conflict​

Platform TypePeacetime ProductionWartime NeedTime to Scale
Artillery shells100K/year (EU)1M+/yearActual: 18+ months
Tactical drones1K/month10K+/monthActual: 12+ months
MANPADS100/month1K+/monthActual: 24+ months

Why so slow?

  1. Supply chain dependencies (Asia, US)
  2. Tooling not pre-positioned
  3. Specialised labour shortages
  4. Regulatory bottlenecks (export controls, ITAR)

Target: Time-to-surge: ≤ 6 weeks

Four Pillars of Surge Capacity​

1. Pre-positioned Tooling​

What: Production equipment and tooling pre-positioned in JEF countries, ready to activate.

Examples:

  • CNC machines (idle but maintained)
  • Additive manufacturing (3D printers)
  • Electronics assembly lines (SMT pick-and-place)
  • Composite layup tooling

Locations:

  • NL — Electronics, photonics (Eindhoven, Twente)
  • SE — Defence platforms (Linköping, Karlskoga)
  • FI — Drone manufacturing (Tampere, Oulu)
  • PL — Assembly, logistics (Warsaw, Gdańsk)

Funding: Availability fees for tooling readiness (see Ecosystem SLAs).

2. Supply Chain Transparency​

Problem: Current supply chains are black boxes with SPOF (single points of failure).

Solution: Digital supply chain twins with transparency over:

  • Critical components (semiconductors, batteries, sensors)
  • Lead times
  • Geographic dependencies
  • Alternative suppliers

Tools:

  • Supply chain mapping software
  • Tier-2/Tier-3 visibility
  • Risk scoring (geopolitical, climate, logistics)

Example:

Component: Edge AI processor
├─ Tier 1: NXP (NL)
├─ Tier 2: TSMC (TW) ⚠️ Geopolitical risk
├─ Tier 3: ASML (NL) lithography
└─ Alternative: Intel (US/EU fabs)

3. Modular Designs​

Concept: Platform designs must be modular for rapid assembly/reconfiguration.

Example: Tactical Drone

Platform
├─ Airframe (composite, 3D printed)
├─ Propulsion (COTS motors + ESC)
├─ Power (modular battery pack)
├─ Sensing (plug-and-play EO/IR)
├─ Comms (modular RF/LEO)
└─ Autopilot (open-source stack)

Benefits:

  • Parallel production of modules
  • Rapid iteration (swap sensor, upgrade comms)
  • Repair/refurb (module replacement)
  • Interoperability (cross-JEF use)

4. Capacity Credits​

What: Pre-paid production capacity with suppliers.

How it works:

  1. Government buys capacity credits (e.g., "1000 drone equivalents")
  2. Supplier keeps tooling/supply chain ready
  3. Upon activation: production starts within ≤ 1 week
  4. Credits are "spent" upon actual production

Analogue: Cloud computing reserved instances.

Pricing:

  • Capacity fee (10-20% of production costs, annual)
  • Activation fee (remaining 80-90%, upon actual production)

Example:

  • 1000 tactical drones @ €50K = €50M production value
  • Capacity fee: €7.5M/year (15%)
  • Activation: €42.5M upon actual production

Surge Scenarios​

Scenario 1: Baltic Escalation​

Trigger: Russian incursion in Suwalki Gap

Response:

  1. T+0 hours: Activation of capacity credits (NL, SE, FI suppliers)
  2. T+1 week: First batch tactical drones (500 units)
  3. T+3 weeks: ISR coverage operational over Suwalki
  4. T+6 weeks: Full surge production (5K drones/month)

Scenario 2: Drone Wall Expansion​

Trigger: Need to extend Drone Wall from Baltic to North Sea

Response:

  1. T+0: Activate pre-positioned sensors (NL, DK stocks)
  2. T+2 weeks: Deploy persistent ISR layer
  3. T+4 weeks: Integrated air picture operational
  4. T+6 weeks: Full coverage + redundancy

KPIs for Surge Capacity​

Time-to-surge: ≤ 6 weeks Production scale factor: 10x Supply chain transparency: Tier-2 visibility Capacity credits activated: ≥ €500M Pre-positioned tooling: 5 JEF countries

Industrial Implications​

Supplier Requirements​

To participate in surge capacity programme:

✅ Supply chain transparency (Tier-2 visibility minimum) ✅ Modular designs (plug-and-play components) ✅ Pre-positioned tooling commitment ✅ Capacity credits contracts ✅ Open architectures (no vendor lock-in) ✅ Dual-use (civilian + military applications)

Financing (Zuidas)​

Dual-use suppliers can use capital markets for:

  • Pre-positioned tooling CAPEX
  • Supply chain resilience investments
  • R&D for modular designs

Investor pitch:

  • Government orders via capacity credits
  • Dual-use revenue (civilian + military)
  • Strategic importance (defence + economic security)

Next: 05 — Ecosystem SLAs