Leonardo Strengthens Domestic Supply Chain with Key Italian Partnership

Leonardo signs a deal with Italian firm Cog to manufacture oil coolers for the AW139 helicopter, boosting domestic supply chains under its 'Crescere Insieme' initiative.

In a strategic move to bolster its domestic manufacturing base, aerospace and defense giant Leonardo has entered a new partnership agreement with Apulia-based firm Cog. The deal, signed on March 21, 2026, represents a further step in the company’s ongoing "Crescere Insieme" (Growing Together) initiative, which aims to enhance local technical capabilities and reduce reliance on foreign suppliers for critical components.

A Critical Component Sourced Locally

Central to this partnership is the development and manufacturing of oil coolers for the gearbox units of the AW139 helicopter. This model is one of the most sought-after aircraft in both civil and military markets globally. By tasking Cog, a manufacturer headquartered in Lecce, with producing this safety-critical precision part, Leonardo is shifting a key element of its supply chain to Italian soil. This component had previously been sourced more heavily from international suppliers.

The "Crescere Insieme" program is explicitly designed to cultivate the technical expertise of domestic partners, particularly for high-precision aerospace parts. The Apulia region is a focal point for this strategy; Leonardo employs approximately 3,100 people across its facilities in Brindisi, Grottaglie, and Foggia alone.

A Dual-Pronged Strategic Approach

The Cog agreement follows closely on the heels of another major corporate development. Just days earlier, on March 18, Leonardo finalized the €1.6 billion acquisition of Iveco’s defense vehicle business. This purchase significantly expands the group’s capabilities in land-based defense systems. Viewed together, these two actions outline a clear corporate strategy focused on growth through vertical integration. Leonardo is simultaneously expanding its portfolio via acquisitions and tightening control over its supply chain through deeper local partnerships.

Market Performance and Operational Imperatives

Leonardo’s shares closed Friday’s trading session at €60.76, marking a decline of roughly 3.3 percent. Market observers attributed this movement to broader sector-wide pressure affecting defense and technology stocks rather than to any company-specific news. Despite the daily drop, the stock remains up by about 19 percent year-to-date.

From an operational standpoint, securing a stable and resilient supply chain is a fundamental requirement for Leonardo’s vertical flight division. The company must ensure it can meet its delivery targets for the AW139 in the coming business years. By bringing Cog on board as a new supplier, Leonardo has reinforced this operational foundation with another crucial domestic building block.