Structural Changes -by vehicle the expense of spending on the defense– In her economy EU And more generally in Europe- the McKinsey Counselors are foreseen, over thirty years after the end of the Cold War.
This is because the defense industry is again becoming a central pillar of industrial production in the EU. The driving force is the annual defense spending of European countries, which are almost expected to doubled in more than 800 billion euros by 2030.
This is the result of an analysis of McKinsey Counseling Company, which was made available to Handelsblatt. The share of the new markets will be particularly high.
Consequently, annual spending on new tanks, unmanned aircraft and software will increase from € 140 billion today to EUR 335 billion in 2030. These figures reflect the plan of NATO Member States to increase their equipment expenditure to 3.5% of the gross product (20%). expenditure on defense infrastructure).
OR GermanyEurope’s largest economy is expected to reach this landmark as early as 2029, according to Finance Minister Lars Clningbail (SPD). Defense spending will then amount to € 153 billion, with an additional € 9 billion to support Ukraine.
Klingbail intends to adhere to this goal, even though financial planning for the coming years contains significant gaps.
“As a Vice -Chancellor and Minister of Finance, I will ensure that money is available for security investment,” Klingbail said last Wednesday (27.8.2025) at the inauguration of a Rheinmetall factory in Lower Saxony. Thus, Germany becomes the driving force behind the development of weapons in Europe.
Orders are currently increasing almost twice as fast than production. Industry already expects important orders. “I am not allowed to say how big the Bundeswehr will order, but I can assure you that the data mentioned so far are very conservative estimates,” Papperger recently said in a meeting with analysts after presenting the semester data. “Germany will order significantly more tanks and military vehicles than we expected.”
The Bloomberg News Agency said the German government could order, among other things, about 3,500 wheelchair Boxer vehicles, which Rheinmetall jointly produces with the French-German manufacturer KNDS. “The order for the boxer is very, very high. We’re talking about a clearly double -digit range of billions, “said Rheinmetall’s chief executive.
The federal government’s clear commitment to invest in equipment has also been criticized. The Federal Control Service, for example, sees abuse. “One ‘whatever it takes!’ based on the security and defense policy should not be made by an administrative ‘money does not matter!’ “reports report by the beginning of July. “If financial resources are not intentionally used, they are missing elsewhere, which means they are not available for the main mission,” the independent budget auditors criticize.
For the treatment of orders, the capacity must be extended. According to McKinsey, the backloging order balances is currently increasing almost twice as fast than production. Time is critical. Defense Minister Boris Pistorius (SPD) warns the industry: “NATO’s new competence requirements provide us with a clear specification and does not say” to be done sometime “but” now “,” he said at the inauguration of Rheinmetall’s artillery factory at Unterlüss.
Such turbocharged supplies are particularly expensive for taxpayers, experts warn. Scientists at the University of Mannheim have analyzed that each euro spent on equipment in Germany leads, at best, to 50 cents of additional economic activity. One reason for this is, among other things, price increases due to lack of capacity and ineffective structures. In the US, the economy benefits significantly more than defense spending.
Industry hopes for frameworks with annual purchase guarantees
The European industry not only has no production capacity, but sometimes it lacks the right products. This applies, for example, to fifth generation fighter aircraft, some software applications or space recognition. The result: By 2021, almost half of the European weapons markets have been to suppliers from the US or South Korea.
For example, Germany has ordered, among other things, F-35 fighter aircraft from Lockheed Martin and Boeing Chinook helicopters. Neighboring Poland, in turn, is based on the main K2 battle chariot by the South Korean manufacturer Hyundai Rotem. Defense circles say that, unlike European battle tanks, South Koreans can simply deliver more tanks in a shorter period of time.
The European Defense Industry is now being prepared, with some delay, for accelerated supplies. “I expect that the first large orders for main battle tanks and armored vehicles will reach our customers this year,” Renk CEO Alexander Sagel told Handelsblatt. Renk, the leading company in the world market for battle tanks, mainly supplies Rheinmetall and KNDS.
In his opinion, existing framework agreements should be used for the new supply of battle tanks: “However, unlike the past, the annual quantities should be guaranteed; this facilitates programming.” Sagel also promises a volume discount for Bundeswehr. The general rule is: “When the quantities increase, prices are also reduced because we can produce cheaper”.
Framework agreements are used to quickly access large quantities of ammunition, drones or other consumables, according to the Bundeswehr (BAINBW) Federal Bureau of Information, Information Technology and Support Technology. For example, they are available for the Wolf 2 all -terrain vehicle with Mercedes, for the lightweight H145M battle helicopter with Airbus and for time -brigade artillery units with Junghans Microtec.
Order large quantities and then resell
Defense circles also report that another procurement model is under negotiated with the Ministry of Defense to facilitate the expansion of industrial capacity.
This model would provide Germany to order military equipment from a company that exceeds its own needs and then resell it to other countries under contracts between governments. Thus, the government becomes a surplus trader.
For defense companies, this would offer the advantage of designing larger quantities, which would allow them to negotiate better prices with their suppliers.
The highest advances in the conclusion of a contract with the federal government could, in turn, be used mainly by smaller and medium -sized defense companies to finance the expansion of their potential. “We see that this idea finds a receptive audience in Berlin,” says a spokesman for a large German weapon company.
Purchasing guarantees would be useful for the industry – despite all the legal consequences if the market is not finally made, says a representative of the Federal Armed Forces (BAAINBW).
However, during the last legislative period, the Community -based agency has assigned contracts worth almost 150 billion euros. Therefore, the industry should know that orders will come.
So far, companies have been largely active in industrial activities. “But we need a quick transition to mass production,” the spokesman says. This has also been understood by defense companies, and large producers are already pre -ordained steel, gunpowder and other materials pending orders from the compartment. Renk has asked the automotive industry to optimize procedures in its main factory in Augsburg.
MBDA CEO Thomas Gottschild says: “We will grow. In Germany, sales could triple and the number of workers to double. ” His company expects, among other things, additional orders for the Patriot anti -aircraft rocket and hopes for repeated orders for Cruz Taurus rocket.
12,000 procurement contracts this year
The top company in the industry, Rheinmetall, also intends to expand significantly. The artillery plant at Unterlüß, which was inaugurated on Wednesday, is just the beginning. New ammunition factories are also manufactured in Lithuania, Romania and Bulgaria. By 2027, Rheinmetall aims to be able to produce about 1.5 million artillery cartridges per year. Before the Russian aggressive war, the number was just 70,000.
The very close links between the German government and Rheinmetall are impressive. At the inauguration ceremony at unterlüß, Pistorius did not hide that. The Minister of Defense addressed Rheinmetall directly: “We want to be successful, because success means security for our country. I am grateful to have you on our side. “
The truth about the increase so far is that the increase in ammunition potential is the simplest project. NATO Secretary -General Mark Rutte therefore calls on the industry to make further efforts. “Now we must also quickly increase the possibilities for more complex products, such as tanks and air defense capabilities,” Rutte said at the inauguration of Rheinmetall’s artillery plant.
So far, little has happened on this issue. The most important battle tanks, Rheinmetall and KNDS, have even slightly increased their battle tanks. This is one of the reasons why the German government will have to wait until 2030 to reach the Bundeswehr and the 123 main Leopard 2 tanks ordered last year.
And new contracts are already underway. According to the Armed Forces Federal Service (BAAINBW), there will be approximately 12,000 procurement contracts, including about 100 exceeding the € 25m threshold. Above this value, the BUDESTAG budget committee is required before the assignment of any contract.