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Today, U.S. and European defense firms are at a crossroads. Opportunities for the construction of a transatlantic defense sector are tangible, but significant obstacles may accelerate the formation of a bipolar industrial base. While market forces played a key role in the transformation and consolidation of these sectors in recent years, political considerations are largely responsible for a restructuring process that has been almost entirely among U.S. firms in the United States and among European Union companies in Europe. In this monograph, Dr. Terrence Guay examines the forces that have shaped the restructuring of the U.S. and European defense industries since the end of the Cold War, and presents factors that will influence further restructuring and consolidation in the short- and medium- terms.