Regardless, many in the industry say that a return to the uneasy status quo that existed before the BAE deal was floated will be next to impossible.

With the dream of a European defense giant dashed, the French could take another look at consolidating their own fragmented sector, which includes combat-to-business jetmaker Dassault, and Thales, Europe’s leading defense electronics group.

Keen for a bigger slice of the massive U.S. defense budget, EADS management may feel compelled to look outside Europe for deals, although politics could get in the way again.

“I don’t think we’ve seen the end of this. We may have only seen the first stage,” said Alexandra Ashbourne-Walmsley, who runs a defense consultancy in London.

Most worrying of all, say European industry sources, is the spectre of a political fight over the crown jewels of Airbus that stokes dormant national rivalries and scares off investors. With no major new projects on the horizon soon, the opportunities for redistributing jobs are limited for now. But that seems unlikely to keep the Germans at bay.

By blocking the BAE deal, Berlin sent a signal to its partners. It may be open to closer European cooperation, but only on its own terms.

That has implications not just for the bold planemaking project launched by Beteille and others in the decades after World War Two, but also for the crisis-hit bloc as a whole.

(Additional reporting by Andreas Rinke, Gernot Heller, Jason Neely, Christiaan Hetzner, Arno Schuetze, Sophie Sassard, Cyril Altmeyer, Emmanuel Jarry, Jean-Michel Belot, Andrea Shalal-Esa, Alwyn Scott; Editing by Sophie Walker and Simon Robinson)