Rheinmetall Must Deliver 40,000 Vehicles in Europe, CEO Says

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00:00Everybody's looking forward, everybody's excited about what you are going to be delivering

00:04in terms of the rearming of Europe.

00:08Is there anything within the current numbers that you've just delivered, which look pretty

00:12good, that tells us about what happens next year and what happens the year beyond?

00:17What should I read into today's figures?

00:19Yeah, first of all, good morning from Germany.

00:24And yes, I think we should go into the different divisions.

00:31So if you see what happens at the moment on our ammunition side, we are on a very good

00:36way with new production lines.

00:38As you know, we want to start now to build up the production lines in Bulgaria, in Romania,

00:45in Lithuania, in Latvia.

00:48So the ammunition line is absolutely, and the ammunition story is absolutely in line.

00:54So this is a very positive signal.

00:57The second thing what we do now in the next year is we do the optimization of the vehicle

01:02systems because we have to deliver only on the European side and mostly for Germany 40,000

01:09vehicles.

01:11And so we have to optimize our production lines.

01:14This is what we do at the moment.

01:16We invest in that area so that we can ramp up the vehicles a lot.

01:21Number three is that we start now, next year, the production of satellites.

01:27So the first of 40 satellites will be under contract, I think, end of the year.

01:33And then, but Germany needs much more.

01:37We speak about 200, 300 satellites that we are able then to produce here in Germany.

01:44So the next thing is on the digitization.

01:49From the digitization side, connectivity, et cetera, et cetera.

01:52We build up the factories.

01:54So we are in good shape.

01:56I mean, you're building, you're building out, you're getting ready, you're going to be producing

02:01an awful lot of kits for the European defense ramp up that we are going to be seeing.

02:06You are at the center of that story.

02:09Does it matter if the German budget kicks in this quarter, next quarter, the quarter after

02:13that?

02:14Kind of what do you think 2026 is going to actually end up looking like?

02:19And when that kind of process starts, when that budget sort of money starts to flow through,

02:24how quickly does it kind of feed down to you?

02:26How instantly is that process going to unfold?

02:29So, first of all, we ramp up at the moment on the German side, the budget, and they do

02:37what they say.

02:38This is a very positive signal for us.

02:42Five years ago, there was a lot of chats, but nothing happened.

02:46Now we are on the way to sign the contracts.

02:51So next year, our expectation is there is a potential on the German side, which is really

02:57on a level of up to 50 billion.

03:01As you know, this year, the order intake we expect is on a level of 80.

03:09And so we fill up the pipeline.

03:12And that's the reason that we have to make these investments.

03:15And at the moment, we are on our way to make everything happen.

03:19Armin, good morning.

03:21You say that the German government is doing what it says, which is interesting to hear.

03:25I know from your statement today, you say nothing less than our democracy and the independence

03:30of Europe are at stake, such as the anticipation around the sector that you operate in.

03:38Would you say that everywhere in Europe is taking this as seriously as it needs to?

03:42Is the money as forthcoming as you want it to be?

03:46I think that not all European countries have the ability to invest such a lot of money,

03:53like Germany is doing at the moment.

03:56But if you see what happens in Italy, the Italians are signing now contracts.

04:02The first contracts are signed also on the infantry fighting vehicles.

04:05Their budgets are going north, which is positive also.

04:11The same is for smaller countries like like the Netherlands.

04:15Look to the Baltics, look to Poland, look to Romania and a lot of other European countries.

04:22I see at the moment a really good opportunity that everything what the Europeans say that they do.

04:30Not as much as Germany is doing.

04:32But yes, they they will go forward.

04:36Well, Armin, let's let's broaden that photo that picture even further if we can and talk about the NATO spend that we're looking to capture.

04:42You mentioned the rearming efforts that are coming from Europeans.

04:45We know the United States is still contributing to NATO as well.

04:47You have a few partnerships with the likes of Lockheed Martin and a few other defense companies.

04:51Can you give us an update on one, what those partnerships look like and to the percentage of the NATO rearmament effort

04:58that Ryan Mittal looks to capture?

04:59The relationship that we have with the American big big companies is a really good one.

05:12It's a very trustful relationship that we have, especially also with Lockheed, but not only with Lockheed.

05:18So, as you know, we have cooperation agreements with Underrail.

05:21We have we are on the way to speak with Raytheon because we step in now also into the naval side.

05:29So it's it's excellent.

05:32It's it's fast and it's very, very trustful.

05:35So we are able to to pick up usually from the German side 40 to 50 percent of the budget of the German budget.

05:44And I always calculate that there should be a possibility that between 25 and 30 percent of the European NATO budget.

05:53Ryan Mittal is able to to pick up.

05:55So it's it's a lot.

05:56I mean, can I ask you what is standing in the way of of your business expanding faster?

06:02I appreciate that you are expanding very quickly, but is there anything blocking your ability to step up as quickly as you want to?

06:08At the moment, not.

06:12We get the permissions and I have I get the permissions in weeks at the moment to build up everything for sure.

06:20We we need production lines.

06:22As I told before, we have to go to optimization.

06:27Otherwise, it will be not possible to produce as much in some areas.

06:31We are ready.

06:32I see at the moment no obstacles.

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