Rheinmetall is repurposing two of its automotive plants in Germany to produce ammunition and other defense products.

Reuters reported on this.

Europe’s largest arms manufacturer is reorganizing its facilities in Berlin and Neuss, which produce automotive parts, to meet defense needs.

According to the plans, both plants will be transferred to the ammunition production division. The company said that these facilities will not perform operations with explosives but will produce mechanical components.

It is specified that the new facilities will become so-called “hybrid plants,” retaining the ability to produce civilian products.

Rheinmetall’s operating profit in the arms and ammunition business nearly doubled to 339 million euros in the first nine months of 2024, while its automotive division’s profit fell 3.8% to 74 million, as reported in November.

“We are well prepared, and we don’t need to be shy – for security in Europe, we need to take action now,” Rheinmetall CEO Armin Papperger told Reuters earlier this month, adding that the company expects to grow even faster than previously thought.

European industry is shifting to a war footing

The organizational changes at Rheinmetall mark the second precedent in a month for a defense company to convert existing civilian facilities to weapons production, as in early February, KNDS Deutschland announced its intention to convert its railcar plant in Goerlitz to armored vehicles.

Alstom, the current owner of the plant, plans to close production in Goerlitz in 2026, while KNDS will gradually launch production at the same time. According to SPIEGEL, the company is investing tens of millions of euros in the new production facility.

KNDS wants to use the plant to weld armor steel hull elements required for producing Leopard 2 tanks, RCH155 self-propelled artillery systems, and Boxer infantry fighting vehicles. The new production facility is expected to reach full capacity by the early 30s.

The need for a new production facility has arisen due to a significant increase in demand for armored vehicles from both the German army and foreign customers.

The acquisition of the plant in Gerlitz is an important step for the German defense company, as the armor steel structures produced there will allow it to abandon the purchase of analogs from foreign suppliers.