COLOGNE, Germany — German defense contractor Rheinmetall has cleared a review by the federal Cartel Office to operate a maintenance plant in Ukraine, as more European arms makers consider setting up shop in the war-torn country.
The decision will enable the Düsseldorf-based company to enter into a joint venture with Ukrainian Defence Industry group, formerly Ukroboronprom, which will be based in Kyiv once all regulatory agencies here have cleared the plans.
Rheinmetall’s footprint in Ukraine will initially enable the maintenance and repair of weapons and vehicles donated to Kyiv by Germany. Also covered is German-made equipment transferred from other countries under Berlin’s “Ringtausch” arms-swapping program.
CEO Armin Papperger has previously said the company also has ambitions to build its own lineup of military combat vehicles in Ukraine, such as the Panther battle tank or the Lynx infantry fighting vehicle.
The joint venture in Ukraine could also involve new, cooperative equipment developments at a later time, with an eye on the export market, Rheinmetall said in a statement.
“Cooperation between Rheinmetall and the Ukrainian defense industry is designed to strengthen Ukraine’s defense sector and ultimately the country’s national security by gradually building joint capabilities in defense technology in Ukraine,” it said. “Under the agreement, Ukraine will benefit from comprehensive technology transfers; from the creation of defense technology capabilities at home; from additional local value added; and from the prompt delivery of military equipment from Germany.”
A company spokesman declined to name which government offices besides the Cartel Office are involved in the ongoing government review, saying only the remaining approvals were expected shortly. Also left unanswered was a question about when the envisioned plant could start work and whether Rheinmetall plans to build new facilities.
Several European companies, including Finland’s Patria and Sweden’s BAE Systems Hägglunds, have said they are evaluating options for local production or maintenance of weapons and vehicles in Ukraine. As with Rheinmetall, the plans have been nebulous on the timing, though they appear to be geared at long-term support for a post-war Ukrainian military, whenever that will come to pass.
Sebastian Sprenger is associate editor for Europe at Defense News, reporting on the state of the defense market in the region, and on U.S.-Europe cooperation and multi-national investments in defense and global security. Previously he served as managing editor for Defense News. He is based in Cologne, Germany.