Against the background of the Ukraine war, the arms manufacturer Rheinmetall has underpinned its ambitions to take its business to a new level. The group would like to double its business with the Bundeswehr alone.
Most recently, around two billion euros a year were received from the federal government, and in the future it should be at least four billion euros a year, said Rheinmetall boss Armin Papperger on Tuesday in Düsseldorf at the armaments group’s general meeting. The proportion of the annual Bundeswehr investments must remain at least the same, that is the prerequisite. The manager is convinced of that. The company did excellent business last year, and Papperger said it was a “record year” for Rheinmetall. Now this upswing is set to accelerate.
Shortly after the start of the Russian attack on Ukraine, Rheinmetall presented a list of armaments whose delivery could start relatively quickly and, depending on the product, could take up to 10 years. For example, tanks, military trucks, anti-aircraft towers and ammunition are offered.
Due to Russia’s war of aggression, which violates international law, the federal government wants to provide significantly more money for the Bundeswehr than before, a so-called special fund of 100 billion euros is intended to eliminate the army’s deficits. The NATO requirement that member states spend at least two percent of economic output on defense should be adhered to in the future, which has not been the case for decades. Papperger spoke of a “new era of defense policy”.
Poland, Romania, Latvia and other NATO countries also want to invest more in their armed forces. “We are in the western world – that is, where we as Rheinmetall are essentially at home – at the beginning of accelerated market growth,” said Papperger. Beyond Germany, one sees “international potential and in some cases very specific projects that will additionally support our growth dynamics”. As an example, he cited a recently announced EUR 850 million ammunition contract with Hungary.
With a view to an EU set of rules that is being prepared in Brussels and is intended to support investments in sustainability, Papperger called for the armaments industry to be classified as socially sustainable – if this were to happen, armaments companies would have a better position on the capital market. “Sustainability can and will only exist where safety is guaranteed; and security can only be guaranteed where there is the ability to defend oneself,” said Papperger, explaining his demand.
This attitude has also met with criticism. Peace activists accuse the company of profiting from the Ukraine war. Around 50 demonstrators waved rainbow flags as a sign of peace as they stood in front of the company’s headquarters during the annual general meeting. One of the demonstrators was dressed as a skeleton with a sickle.
About a decade ago, the armaments company wanted to sell a combat training center to Russia, as peace activists criticize. The federal government stopped this in 2014 because of Russia’s annexation of Crimea. In a statement, Barbara Hoppe from the human rights organization Urgewald accused the group of not being a “noble security guarantor”. At the time, only the veto of the federal government prevented “that since then, 30,000 Russian soldiers have not practiced or are still practicing for the war with Rheinmetall technology every year.”
Why did Rheinmetall initially receive an export license for the Russia deal, which was later revised? “Germany wanted to train Russia at the time – before the Crimea crisis” in order to strengthen Moscow in the fight against terrorism, said Papperger at the shareholders’ meeting. “From today’s perspective, it was the right decision that we didn’t deliver.”