German, Italian companies commit to enhanced defence capabilities

Germany’s Rheinmetall arms manufacturers company and Italian Leonardo aerospace company have embarked on a significant partnership to modernise the Italian military, unveiling plans for a comprehensive programme that will deliver advanced infantry fighting vehicles and main battle tanks over the next decade. 

The joint venture, named Leonardo Rheinmetall Military Vehicles (LRMV), will operate as a 50-50 partnership, with its headquarters in Rome and operational facilities in La Spezia, Italy’s centre for ground vehicle production, Caliber.Az reports via foreign media.

This collaboration was established to meet the Italian army's need for modern fighting vehicles and tanks. In terms of work distribution, Leonardo will handle 50 per cent of the tasks, while Rheinmetall in Germany will manage 40 per cent, and the remaining 10 per cent will be executed by Rheinmetall’s Italian operations.

Described by the companies as a “new European nucleus for the development and production of military combat vehicles,” this venture follows a memorandum of understanding signed in July and arises after earlier plans between Leonardo and KNDS fell through due to disagreements over workshare expectations. 

At a press conference in Rome, Leonardo CEO Roberto Cingolani emphasised the importance of European firms collaborating to guide governments towards greater industrial integration, even if it means sacrificing some domestic market share. “We hope this will be a seed for the growth of a safer Europe,” he stated. 

Rheinmetall CEO Armin Papperger added, “We negotiated everything in 3-4 months and made it happen.” The agreement entails the production of 1,050 new infantry fighting vehicles for the Italian army, based on the Rheinmetall Lynx, to replace the outdated Dardo vehicles. 

The programme is set to provide 16 different versions of vehicles, with the first delivery scheduled in two years, running until 2040 at a total cost of 15 billion euros ($16.4 billion), according to the managers.

Rheinmetall’s developing Panther KF51 will serve as the foundation for a new main battle tank to replace Italy’s Ariete tanks, with 132 units planned as part of an 8 billion-euro-programme set to continue until 2035, and the first tank expected in two and a half to three years.

Papperger mentioned that a 130mm gun could be ready for the tank within three years if requested by the Italian government. 

When asked why Leonardo ended its discussions with KNDS about supplying the Italian army with the Leopard, Cingolani explained that KNDS could only guarantee the first tank in five years. In their announcement, the companies stated that Leonardo will handle mission systems, electronic suites, and weaponry for the vehicles intended for the Italian army.

Papperger noted that a brief half-hour conversation with Cingolani about merging Rheinmetall’s platforms with Leonardo’s digital capabilities was sufficient to finalize the partnership. “It was clear that the complementarity with Rheinmetall was very high,” Cingolani remarked, adding that the new vehicles are likely to be among the most advanced in Europe and globally.

Papperger pointed out that the vehicles have export potential, stating, “While our primary focus is on the Italian market, we will also target other partner nations that need to modernize their combat systems.” 

He highlighted that most of the 5,000 main battle tanks worldwide are at least 35 years old. He estimated that the new joint venture could generate revenues of 2 billion euros to 4 billion euros annually, with a profitability margin of 15 per cent.

Cingolani indicated that by networking the new vehicles, additional business opportunities could arise. 

“These machines will communicate with satellites, supercomputers, and other platforms, allowing us to develop and integrate newer technologies,” he noted. 

Papperger assured that the partnership with Leonardo would not compromise their commitment to developing a new European tank with KNDS, which is expected to be ready by 2040. 

“Given the current situation, there is an urgent need for infantry fighting vehicles and tanks over the next decade,” he said, adding that the European tank program is a separate initiative and “is not dead.”

By Naila Huseynova