Rheinmetall AG, currently Germany’s largest arms manufacturer and the fifth largest in Europe, may be poised for significant growth as Berlin seeks to rebuild its military. At the same time, other NATO countries increase their defense spending.
“An era of rearmament has begun in Europe that will demand a lot from all of us,” Rheinmetall CEO Armin Papperger told the German-based publication DW.
That could result in “growth prospects for the coming years that we have never experienced before,” he added, suggesting the company is on track to see 25 to 30 percent growth since Russia launched its unprovoked invasion of Ukraine three years ago.
Its defense sales could increase by as much as 35 to 40 percent for this calendar year, driven by the Trump administration’s stance that the defense of Europe and its commitment to the NATO alliance is no longer a top U.S. priority.
“[Rheinmetall is] on its way from being a European systems supplier to a global champion,” reaffirmed Papperger.
Rheinmetall remains Europe’s largest producer of munitions and other ordnance, including the 155mm shells used in NATO tanks and artillery systems, which continue to be supplied to Ukraine. The German company’s stock has increased by more than 1,000 percent since the start of the conflict.
Rheinmetall: Massive Increases in German Production
As Rheinmetall expects such growth in sales, the Düsseldorf-based company has cast its sights on Volkswagen’s Osnabrück plant in northern Germany. Though the company has considered converting its automotive plants for military production, the VW facility has other benefits.
“Osnabrück would be a very suitable location for defense production,” Papperger explained in an earnings call with investors.
The German automaker has reportedly been exploring options for the facility’s future, which has been a final assembly plant for Volkswagen, Porsche, and Skoda automobiles. As the country’s auto industry is restructuring, new options are on the table, with Rheinmetall being an eager potential buyer.
Though the arms maker recently built another facility in Unterluss, Germany, buying an existing factory could be transformed in less time while the infrastructure is already primarily in place. Volkswagen’s Osnabrück plant might need only minor retooling.
Newsweek reported that the VW plant has “heavy-duty cranes and high load-bearing capability,” making it “well-suited for producing armored vehicles, including the Lynx infantry fighting vehicles.”
In addition, there may have been a local workforce that could be quickly retrained and upskilled accordingly. Yet, before Rheinmetall moves forward, it will need to ensure that the orders for the Lynx take shape. “If the conditions are right, things could move quickly…One thing is clear: before I build a new tank factory in Germany, we’ll, of course, take a look at [Osnabrück].”
A partnership between the two German companies is also being explored, which could include the production of military trucks.
Supporter of German Rearmament
Papperger, who was the target of a Russian assassination plot last year and now has a personal security detail, has maintained that Germany must rearm to stop further aggression from Moscow.
“It’s not like five years ago,” he told The New York Times this week.
“Germans have understood that it was a mistake not to spend on defense.”
About the Author: Peter Suciu
Peter Suciu is a Michigan-based writer. He has contributed to more than four dozen magazines, newspapers, and websites with over 3,200 published pieces over a twenty-year career in journalism. He regularly writes about military hardware, firearms history, cybersecurity, politics, and international affairs. Peter is also a Contributing Writer for Forbes and Clearance Jobs. You can follow him on Twitter: @PeterSuciu. You can email the author: [email protected].
Image: Shutterstock/ Torsten Purche.
