Rheinmetall and OHB in talks to build German Starlink rival for the Bundeswehr

Defense giant Rheinmetall and satellite manufacturer OHB are in advanced discussions to submit a joint bid for a satellite internet service for the German armed forces, designed to rival Elon Musk’s Starlink.

According to three sources speaking to the Financial Times (FT), the partnership talks are in their early stages. The deal would position the groups to secure a portion of Berlin’s €35 billion budget earmarked for military space technology.

The proposed joint venture aims to secure a multi-billion euro contract to develop a secure, military-grade satellite communication network in low Earth orbit (LEO) for the Bundeswehr. Officials have characterized the project as a “Starlink for the Bundeswehr.”

Discussions between Düsseldorf-based tank manufacturer Rheinmetall and Bremen-based OHB followed Berlin’s pledge last year to invest €35 billion in military space capabilities. This has sparked intense competition among European defense and aerospace firms for lucrative contracts.

As the European Union’s largest economy, Germany is moving to rapidly expand its military capacity and reduce its strategic reliance on the US. SpaceX’s Starlink, the world’s largest space-based broadband provider, currently operates over 9,000 satellites in LEO—roughly 2,000 km above Earth—serving millions of customers.

Originally a commercial service, Starlink’s high speeds and portable terminals became indispensable for Ukrainian defense forces following Russia’s full-scale invasion.

When other networks were destroyed or jammed, Starlink provided highly resilient battlefield communications. SpaceX has since launched Starshield, a dedicated LEO satellite service for defense and intelligence clients.

However, growing concerns over reliance on Musk or the US have prompted several nations to develop their own secure, sovereign networks. According to space consultancy Novaspace, Germany’s investment plans will make it the world’s third-largest spender on space technology, trailing only the US and China.

Armin Fleischmann, a space coordinator for the German military, told Handelsblatt last week that the Bundeswehr network would be established “within the next few years, primarily with German companies.”

Fleischmann noted that the initial priority would be NATO’s eastern flank, where Germany is establishing a permanent 5,000-strong brigade in Lithuania, with “everything else to follow.” He added that the military has finalized its specifications and procurement authorities are preparing to issue the tender.

While Rheinmetall has traditionally focused on the production of tanks, artillery, and ammunition, the company is rapidly diversifying as Germany ramps up its defense spending.

At the end of last year, the company secured its first space contract, valued at €2 billion. Under this agreement, Rheinmetall partnered with Finnish space-tech firm Iceye to manufacture satellites at a former automotive plant in Germany.

The companies will produce a constellation for radar reconnaissance—a technology uniquely suited for surveillance through cloud cover, adverse weather, or darkness.

The proposed venture with Rheinmetall comes as OHB, which supplies satellites for the EU’s Galileo navigation constellation, faces competitive pressure from a potential merger of the space divisions of Airbus, Thales, and Leonardo.

OHB CEO Marco Fuchs has warned that such a merger, which would consolidate Europe’s two largest satellite manufacturers into a single entity, could stifle competition.

As Europe’s third-largest satellite manufacturer, OHB may struggle to compete alone. However, Germany’s push for a new network offers an opportunity to expand its portfolio of small and medium-sized satellites.

Already a supplier of radar reconnaissance satellites to the German military, OHB is eager to expand its defense operations. Last week, the company raised its earnings and revenue forecasts for this year and next, driven in part by the anticipated surge in military space spending.