Rheinmetall capitalizes on Western insecurities
Demand for munition has spiked since the onset of the war in Ukraine not only for use on the battlefield but also for restocking European governments' military capacities in face of what they see as a heightened threat from Moscow.
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A man on a bicycle passes the headquarters of Germany's biggest arms manufacturer Rheinmetall AG in Duesseldorf, Germany, Monday, Jan. 23, 2023 (AP Photo/Martin Meissner)
Rheinmetall, the military industry firm based in Germany, announced its readiness to step up its production of tanks and artillery munitions to meet the rising demand in Ukraine and the West. it was also announced that they may start producing HIMARS multiple rocket launchers, according to Rheinmetall CEO Armin Papperger.
The defense minister Boris Pistorius is set to meet with managers of defense industries for the first time. After nearly a year of weaponry deliveries to Ukraine have exhausted the German military's stocks, Pistorius hopes to begin discussions on how to quicken weapon purchases and increase ammunition supplies in the long run.
Although Rheinmetall manufactures a variety of defense goods, it is most notorious for producing the Leopard 2 tank's 120mm gun.
Read more: The decision has been made: Germany agrees to send Leopards to Kiev
"We can produce 240,000 rounds of tank ammunition (120mm) per year, which is more than the entire world needs," CEO Papperger said in an interview with Reuters.
He added that the capacity for manufacturing 155mm artillery rounds increase up to 500,000 per year, making Rheinmetall the largest manufacturer of both types of ammunition.
Papperger claimed that Rheinmetall produced between 60,000 and 70,000 rounds of artillery and tank shells in 2022 and that output could be increased right away.
Since Russia invaded Ukraine in February of last year, demand for munition has spiked since the onset of the war in Ukraine not only for use on the battlefield but also for restocking European governments' military capacities in face of what they see as a heightened threat from Moscow.
Papperger added that updated models of the Gepard anti-aircraft tanks would go live mid-year.
H.I.M.A.R.S. production
He also announced that his company is in talks with Lockheed MartinLMT.N, the American arms manufacturing company notorious for producing the HIMARS (High Mobility Artillery Rocket System) multiple rocket launchers that Ukrainian troops frequently employ.
"At the Munich Security Conference, we aim to strike an agreement with Lockheed Martin to kick off HIMARS production (in Germany)," Pepperger said.
"We have the technology for the production of the warheads as well as for the rocket motors - and we have the trucks to mount the launchers upon," he added.
The addition of a deal might lead to investments of several hundred million euros, with Rheinmetall financing the majority of those funds.
Rheinmetall also plans to open a new powder plant, in the state of Saxony in eastern Germany, but the 700–800 million euro investment would need to be made by the Berlin government, Papperger said.
Read more: Defense commissioner admits German army incapacity
"This is an investment that is not feasible for the industry on its own. It is an investment into national security, and therefore we need the federal state," he said.
Papperger lobbied for an increase in Germany's defense budget a few days prior to the meeting with the defense minister.
Read more: $100 billion not enough to modernize armed forces: German MoD
"The 51 billion euros in the defense budget will not suffice to purchase everything that is needed. And the money in the 100 billion euro special funds has already been earmarked - and partially been eaten up by inflation," he said.
"100 billion euros sounds like a giant sum but we would actually need a 300 billion euro package to order everything that's needed."
