The need to replenish stores of ammunition caused by the war in Ukraine is resulting in major artillery ammunition contracts for Rheinmetall.
The German Bundeswehr has just issued a large-volume order for service and practice artillery ammunition worth around €1.3 billion, including value added tax. Two contracts to this effect have now been signed at the Federal Office for Bundeswehr Equipment, Information Technology and In-Service Support (BAAINBw) in Koblenz.
Rheinmetall has been awarded a new framework contract for the supply of 155mm artillery ammunition, while an existing framework contract has been expanded. In all, the scope of delivery encompasses several hundred thousand shells of various types, including fuses and propelling charges. Set to run until 2029, the new framework contract represents potential order volume of around €1.2 billion, including VAT.
Featuring insensitive characteristics, the DM121 high-explosive shell is used for training and exercise purposes.
The first call-offs for service and practice ammunition from the framework contract cited above came as soon as the contract was signed. Delivery of shells worth €127 million (including VAT) is due take place shortly.
The latest orders underscore once again Rheinmetall’s technological lead as a developer and producer of ammunition in Europe. Furthermore, the framework contracts will help to assure a secure supply of ammunition to the armed forces of Germany and other NATO nations, enabling better planning of production processes and optimum utilization of capacity. Moreover, thanks to assured long-term production of various types of ammunition during the lifetime of the contract, resulting in availability at short notice, the framework contract also offers logistical advantages to other 155mm artillery users. For Rheinmetall, the framework agreement means a basic level of capacity utilization at its ammunition production plants for years to come.