Massive Order for Bundeswehr Tanks Sparks Manufacturing Questions
The German government is poised to initiate a substantial procurement of military tanks, with plans to acquire thousands for the Bundeswehr. This decision arises amid ongoing geopolitical tensions, particularly in light of the conflict in Ukraine and threats from Russia.
Recent reports indicate that the coalition government, comprising the CDU/CSU and SPD, under Chancellor Friedrich Merz, is considering a defense budget allocation of approximately EUR25 billion for the acquisition of up to 1,000 Leopard 2 tanks and 2,500 GTK Boxer wheeled armored vehicles. However, critical questions remain regarding the production capabilities and the entities responsible for manufacturing these military assets.
According to sources, the Leopard 2 tanks are manufactured by KNDS Germany in Munich, formerly known as Krauss-Maffei Wegmann, while the GTK Boxer vehicles are produced by Rheinmetall based in Düsseldorf. Both companies are expected to receive significant contracts for this large-scale order. The government has previously indicated a preference for awarding contracts to domestic manufacturers to stimulate the economy.
In addition to the new orders, Germany is under pressure from NATO to establish seven new combat brigades by 2030, necessitating the addition of around 35,000 personnel along with more than 600 Leopard 2 tanks and over 1,000 infantry transport vehicles. Currently, the Bundeswehr's land forces include 310 Leopard 2 tanks of various models, 350 Puma infantry fighting vehicles, and a number of older models, including the Marder and Boxer.
The Bundeswehr has already placed orders for 123 advanced Leopard 2A8 tanks, primarily for deployment in Lithuania, alongside additional Puma vehicles and Boxer units. However, the timeline for delivery is uncertain, even as the defense budget allocates up to EUR649 billion for military expenditures by 2029.
Concerns have been raised regarding the production capacity for these new orders. Ralf Ketzel, CEO of KNDS, stated in a recent documentary that it typically takes about two years from order placement to delivery of a single tank. The production facility in Munich-Allach currently has the capability to manufacture only 40 to 50 tanks annually. Moreover, Germany is not the sole NATO member placing orders with KNDS, as Hungary and Norway are also in the queue for Leopard 2 tanks.
In February, KNDS acquired a factory from Alstom in Görlitz, which is being repurposed to produce military equipment. Starting in 2026, this facility is expected to manufacture Leopard 2 tanks. However, details on the estimated production rate remain undisclosed. Alongside production facilities, there is also a pressing need for trained personnel in the defense sector, which has been expanding in response to increased demand following Russia's invasion of Ukraine.
In Flensburg-Handewitt, another defense company is set to invest approximately EUR75 million to establish a new manufacturing and maintenance facility, intended to produce lighter tracked vehicles and Wisent 2 armored bridge layers for the Bundeswehr.
As the German government navigates the complexities of military procurement and production capacity, the strategic implications of these decisions will undoubtedly shape the future of the Bundeswehr and its readiness to respond to evolving security challenges.