Germany and the USA unite efforts for the production of ATACMS and Patriot missiles in Europe.

German Rheinmetall and American Lockheed Martin create a joint venture in Europe

The German arms manufacturer Rheinmetall and the American corporation Lockheed Martin plan to establish a joint venture for missile production in Europe. This strategic initiative aims to meet the growing demand in Europe for precision munitions and air defense systems amid increasing geopolitical tensions.

The goal of the collaboration is to create a European 'Center of Competence' for missile production. Rheinmetall will hold a 60% stake in the joint venture. This indicates significant changes in transatlantic defense cooperation, according to Rheinmetall CEO Armin Papperger.

According to Papperger, the joint venture aims to overcome bottlenecks in supply chains that lead to long wait times for European countries for defense systems from the USA.

Plans for the joint venture and market expectations

The initiative envisions starting production of missile engines in 2026 and missiles by 2027, with an expectation of ramping up production by 2029-2030. The enterprise could have annual sales of up to 5 billion euros.

At the heart of the partnership are the ATACMS and Patriot PAC-3 MSE missile systems. ATACMS is designed for strikes against high-value targets at a distance of up to 300 km. The Patriot PAC-3 MSE is used for air defense and can intercept ballistic missiles, cruise missiles, and aircraft.

Analysis

The formation of the joint venture between Rheinmetall and Lockheed Martin responds to the increasing need in Europe for missiles and air defense systems. This initiative will enhance cooperation among partners and allow European countries to acquire defense systems more quickly. The anticipated success of the enterprise could significantly impact the European defense industry and assist NATO allies in maintaining their defense posture.