Rheinmetall plans to increase ammunition production and HIMARS production in Germany

DUESSELDORF, Jan 29 (Reuters) – German arms maker Rheinmetall is set to dramatically increase production of tank and artillery ammunition to meet strong demand in Ukraine and the West, and may start producing launchers. multiple HIMARS rockets in Germany, CEO Armin Papperger said. Reuters.

He spoke days before German defense industry bosses were due to meet new defense minister Boris Pistorius for the first time, although the exact date has yet to be announced.

With this meeting, Pistorius aims to initiate discussions on how to accelerate the supply of weapons and increase the supply of ammunition in the long term after almost a year of arms donations to Ukraine have exhausted the stocks of the German army.

Rheinmetall (RHMG.DE) makes a range of defense products, but is probably most famous for making the 120mm gun for the Leopard 2 tank.

“We can produce 240,000 rounds of tank ammunition (120mm) per year, which is more than the whole world needs,” Papperger said in an interview with Reuters.

The production capacity of 155mm artillery shells can be increased to 450,000 to 500,000 per year, he added, which would make Rheinmetall the largest producer for both types of ammunition.

In 2022, Rheinmetall made some 60,000 to 70,000 shells each of tank and artillery shells, according to Papperger, who said production could be increased immediately.

Demand for this ammunition has skyrocketed since Russia’s invasion of Ukraine last February, not only because of its massive use on the battlefield, but also because Western militaries fill their own stockpiles. , preparing for what they see as an increased threat from Moscow.

Papperger said a new production line for medium-caliber ammunition, used for example by German-made Gepard anti-aircraft tanks in Ukraine, would be commissioned by the middle of the year.

Germany has been trying for months to find new ammunition for the Gepard that its own army decommissioned in 2010.


At the same time, Rheinmetall is in talks with Lockheed Martin (LMT.N), the U.S. company that makes the High Mobility Artillery Rocket System (HIMARS) multiple rocket launchers widely used by Ukrainian troops, Papperger said.

“At the Munich security conference, we aim to reach an agreement with Lockheed Martin to start HIMARS production (in Germany),” he said, referring to an annual gathering of political and defense leaders. in mid-February.

“We have the technology for the production of the warheads as well as the rocket engines – and we have the trucks to mount the launchers on,” Papperger said, adding that a deal could lead to investments of hundreds of millions of dollars. euros of which Rheinmetall would finance a major part.

Rheinmetall is also considering the operation of a new powder plant, possibly in the state of Saxony in eastern Germany, but the investment of 700-800 million euros should be supported by the government. of Berlin, he said.

“The state has to invest, and we bring our technological know-how. In return, the state gets a share of the factory and the profits it makes,” Papperger suggested.

“This is an investment that is not feasible for industry alone. This is an investment in national security, and so we need the federal state,” he said.

The factory is needed because shortages in the production of special powders could prove to be a bottleneck, hampering efforts to increase production of tanks and artillery shells, he noted.

A few days before the meeting with the new defense minister, Papperger lobbied for an increase in Germany’s defense budget.

“The €51 billion defense budget will not be enough to buy everything that is needed. And the money for the €100 billion special funds has already been affected – and partially gobbled up by inflation,” did he declare.

“100 billion euros sounds like a giant sum but we would actually need a package of 300 billion euros to order all that is necessary,” he added, noting that the special fund of 100 billion does not include ammunition purchases.

Even before Russia’s invasion of Ukraine, Germany was 20 billion euros short of meeting NATO’s ammunition stockpiling target, according to a defense source.

Just to fill the lack of ammunition, Papperger estimates that the Bundeswehr (German armed forces) should invest three to four billion euros per year.

In talks with the minister, the defense boss hopes for a shift towards more sustainable long-term planning for German purchases, spanning several years, as industry needed to be able to make arrangements in time.

“What we’re doing right now is actually war stockpiling: last year we pre-financed 600-700 million euros for goods,” Papperger said. “You have to get out of this crisis management – it’s crisis management when you buy (raw materials and others) without having a contract – and get into a regular routine.”

Reporting by Sabine Siebold, editing by Angus MacSwan

Our standards: The Thomson Reuters Trust Principles.


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