In a strategic move to fortify Ukraine's defensive capabilities, Rheinmetall, a tech enterprise based in Düsseldorf, clinches a deal to provide 155mm artillery shells.
The NATO partner nation's commitment shows international support for Ukraine's ongoing defensive struggle as global demand for artillery ammunition surges.
Valued at €142m ($154.7m), this deal will produce tens of thousands of complete 155mm artillery shells, encompassing the projectile, fuse, propellant, and primer. The customer, a NATO partner nation, is dedicated to offering effective long-term military aid supporting Ukraine's defence.
The artillery shells will be manufactured by Rheinmetall Expal Munitions, the company's recently acquired Spanish subsidiary. The delivery of these munitions is scheduled for 2025, with a prior order of around 40,000 rounds expected for production and delivery in 2024.
Notably, demand for artillery ammunition has reached unprecedented levels, driven not only by Ukraine's requirements but also by the imperative to replenish depleted ammunition depots in Germany, NATO, and EU countries.
The ongoing munitions shortage in the Ukraine conflict has revealed a critical flaw in the global defence industry's ability to meet the demand for various types of munitions amid the first high-intensity conflict in Europe since WWII. Europe's slower defence procurement tempo impedes rapid production scaling, exacerbated by regulatory pitfalls.
In addition to this recently secured contract, Rheinmetall had previously confirmed an order from the German government for over 100,000 rounds of 155mm ammunition earmarked for Ukraine. This order, placed in mid-October 2023, includes additional DM 121 high explosive shells, reaching a figure in the mid-three-digit million-euro range.
Rheinmetall is gearing up to expand ammunition production capacity in 2024. With plans to augment output across plants in Germany, Spain, South Africa, and Australia, the company aims to achieve an annual production capacity of approximately 700,000 artillery rounds.
Notably, Rheinmetall is already engaged in multiyear framework contracts, supplying the German Bundeswehr with several hundred rounds of artillery ammunition, with a cumulative worth exceeding €1bn.
