Boeing didn't disappear post X-32 nor did LM after loosing the B-21 for NG.
No, Boeing just kept flogging F/A-18s to the USN and USMC and F-15s to the USAF. They couldn't even build an advanced jet trainer without help from SAAB despite being one of the biggest aircraft manufacturers in the world.
LM has its hands more than full with F-35 and keeping F-22 updated (and black programmes).
Both have the joys of NGAD to keep their designers doodling for a while longer.
What's really killing the European industry is the sovietization of project management.
Small European aircraft manufacturer like those on the GA market have bloomed in the past 20 years, thanks to being somewhat hidden from the preying eyes of state descion makers despite being on a very competitive, innovation driven.
I don't think that is necessarily true.
Europe has been continually rationalising its industries as smaller firms went out of business and as merger-mania took hold in the wheeler-dealer 1990s. So competition is harder because there are fewer companies around with the necessary capabilities. Innovation requires resources too. Since the 1960s the mantra from government (and industry) has been collaboration to share R&D costs and few companies now are able to function as complete design and production houses like they could in the 1950s as collaborations reduced them to largely being sub-contractors to umbrella organisations like Panavia GmbH and Eurofighter GmbH.
What do we have:
Airbus - has been the flagship Franco-German aviation cooperation since 1969 and has absorbed most of the German and French aircraft industries. Its subsidiary parts designed and built Eurofighter but Airbus itself has only achieved the A400M in fixed-wing military aircraft. Like Boeing, it's giant but paradoxically weak in terms of R&D ability (only A350 is new, A220 was brought) and AFJT seems purely to be a Spanish national project from Getafe.
If SCAF fails it looses nothing as Premium AEROTEC already has a lot of other Airbus work to keep it busy.
BAE Systems - a giant defence company but Typhoon is its last aircraft product, now they have to figure how to keep Warton open for the next 15 years with no aircraft to build beyond F-35 parts... (Taranis and UCAVs seem to be a dead end so far). If Tempest fails and BAE Systems will shut up shop and concentrate on more profitable systems.
Dassault - was able to keep itself out of Aerospatiale and Airbus because its fighters kept cash rolling in. Business jets help but the market (and development) is bumpy, so its make or break, Rafale stops selling and they are in big trouble. SCAF is a lifeline, like Tempest it has to work or its game over.
Leonardo - Aermacchi and Augusta of old, mainly rotary-wing and the M-series of trainers are modest sellers. Capable but lacking the resources to go it alone on a major project and Tempest is a welcome boost, but they have lucrative F-35 assembly too.
SAAB - like BAE and Dassault, Gripen is a sole lifeline plus some T-7 work. Tempest ensures that they keep going.
5 companies - 3 have essential need of a new fighter to survive, 2 do not. Dassault and perhaps SAAB could go it alone with enough government support, the others less so.
In theory SCAF and Tempest should be nearly balanced between partners and both feel like natural groupings.
Innovation means R&D cost. Developing a new ultralight sports plane isn't cheap but its not in the same league as multi-billon defence projects. Ultimately someone has to pick up the R&D cost, in the GA sector you can get that back over large production runs or licence the design to others or find an investor with big pockets.
For airliners the airlines ultimately pick up the cost, for military aircraft its governments.
Governments have a more direct stake in military aircraft as they specify what they want and stump up the cash for R&D and the purchase price, hence the desire to meddle more in things like IP.
