Rheinmetall, Lockheed Martin partner for European missile plant

German arms manufacturer Rheinmetall and US Lockheed Martin have decided to establish a joint venture to produce missiles in Europe.

According to the Hartpunkt, the parties plan to produce ATACMS and GMLRS rockets with ranges of 300 km and 150 km, respectively, for the HIMARS and M270 MLRS multiple rocket launcher systems, Hellfire and JAGM missiles for unmanned aerial vehicles and aircraft, and PAC-3 missiles for Patriot air defense systems.

Rheinmetall CEO Armin Papperger stated that his company will have a 60% stake in the future joint venture with Lockheed Martin.

Papperger explained the reason for establishing this venture as the inadequacy of production facilities in the US to meet European demand.

“Sometimes you have to wait ten years to get missiles from America, which is a very long time. For this reason, both partners decided to establish a ‘center of competence’ for missiles in Europe,” Papperger said.

According to Papperger’s statements, the facility’s capacity will be 10,000 missiles and the same number of engines per year. Once the project, which both partners are working on, is approved by the US government, the production line is expected to be ready within 12-13 months.

While full vertical integration and some joint development are foreseen, intellectual property rights will belong to the European side. Engine production is expected to start in 2026, and missile production in 2027.

Papperger estimated the potential profit at 5 billion euros. According to Papperger, the current annual demand from customers is around 600-800 ATACMS, 2,500 GMLRS, 5,000 Hellfires, 5,200 JAGM, and 300 PAC-3 missiles.

At the same time, while European customers prefer ATACMS missiles with a 300 km range, Germany wants to acquire missiles with a 500-600 km range.

Lockheed Martin is currently ceasing ATACMS production as it has started producing the newer PrSM missiles.

In this context, Papperger noted that the possibility of fulfilling American contracts in the new factory is being discussed, which could provide an initial turnover of 1-2 billion euros.

Papperger predicted that the new venture’s capacity would quickly be filled thanks to orders from Ukraine, which has a high demand for Patriot missiles.

Leading arms manufacturers worldwide began considering establishing joint ventures during the Munich Security Conference.

Papperger added that five-year contracts with high advances are planned to be signed with electronic component manufacturers for this purpose, and supply chains for production are currently being established.

In a statement to Hartpunkt, Lockheed Martin reported that it is engaging with European allies to identify opportunities for cooperation to meet global demand for US munitions and precision-guided weapons.