Rheinmetall, Germany's largest armament company, is experiencing a significant boom in its military segment, driven by increased defense spending and geopolitical tensions. The company plans to expand its workforce by 25%, reaching 40,000 employees, including temporary workers. This expansion is fueled by a record-high order backlog of 55 billion euros, largely attributed to the Ukraine conflict and a heightened demand for military equipment such as tanks, artillery, and drones.
Rheinmetall's strategic shift involves converting sites in Neuss and Berlin into hybrid plants producing both civilian and military products. This diversification is crucial as the automotive supply sector, traditionally part of their operations, faces a downturn. CEO Armin Papperger recognizes the automotive industry's challenges and is steering the company towards more lucrative military contracts.
The company reported a record revenue of 9.75 billion euros, with 80% of this stemming from its military division. Rheinmetall's success is further bolstered by its delivery of advanced weapon systems and munitions to NATO states and the Bundeswehr. The firm is expanding its production capacity, especially at the Unterlüß site, anticipating a 25-30% revenue increase by 2025.
Rheinmetall is also navigating security concerns, with CEO Papperger under police protection due to alleged threats. Despite these challenges, the company remains a pivotal player in the global arms market, capitalizing on the current geopolitical climate to enhance its growth trajectory.
