The time of battle tanks on the battlefield is apparently not over yet. Düsseldorf-based Rheinmetall AG expects to be commissioned to modernize the British Army's Challenger main battle tanks. As Rheinmetall CEO Armin Papperger explained yesterday at the company's annual press conference, the British Ministry of Defense is expected to announce in the coming days that it has commissioned the German defense company to digitize the Challenger turret and integrate a smoothbore cannon. In a first step, he put the expected value of the project at 750 million euros. In addition, a second contract for ammunition deliveries will probably be concluded this year, said Papperger. This is a deal between the British and German governments. There had been discussions in Great Britain for a long time about completely abolishing battle tanks in their own armed forces.
According to the Rheinmetall boss, the super cycle in the defense sector will continue in the coming years. He sees great interest in the Lynx infantry fighting vehicle developed in-house. After signing a contract last fall in Hungary for the production of over 200 combat vehicles, Rheinmetall is now in talks with the Czech Republic, Slovenia, Slovakia and, more recently, Italy. Papperger put the long-term business potential for the Lynx at EUR 15 to 40 billion - although an order from the USA would be required to realize the latter figure. Papperger expects a decision in Australia this year, where Rheinmetall is competing with the Lynx as part of the Land 400 program.
If Rheinmetall were awarded the contract to supply an infantry fighting vehicle in the USA as a successor to the Bradley, the vehicles would be manufactured entirely in the USA together with local partners. According to its own information, Rheinmetall founded a US company last year that is also allowed to participate in programs only for American bidders.
Nach Aussage des Firmenchefs hat der Düsseldorfer Konzern im vergangenen Jahr viele wichtige Aufträge gewonnen und den Auftragsbestand auf einen Rekordwert von über 13 Mrd. EUR gesteigert. Dazu kommen seinen Worten zufolge noch Rahmenverträge für militärische Lkw und Munition in einer Größenordnung von mehr als 3,5 Milliarden Euro.
According to its own information, the Rheinmetall Group achieved consolidated sales of 5,875 million euros in the 2020 financial year, which was heavily influenced by the global Corona crisis. Compared to the previous year, revenues fell by 380 million euros.
While the defense sector increased sales, sales in the automotive division fell. The foreign share of group sales was 66 percent in the reporting year, which was below the previous year's figure of 69 percent. According to the information, the Defense division achieved sales of 3,723 million euros in the 2020 financial year, exceeding the previous year's figure by 201 million euros. Rheinmetall Defense achieved order intake of 6,387 million euros in the reporting period, after 5,186 million euros in the previous year.
As a result of the realignment of the group structure and the elimination of the Automotive and Defense divisions, reporting will be carried out exclusively at group or division level from the 2021 financial year. For the current 2021 financial year, the group expects sales growth of 7 to 9 percent. In the long term, sales in the five core business divisions are expected to increase to a total of around 8.5 billion euros by 2025. By then, profitability in the group should improve to an operating return of at least 10 percent.
Lars Hoffmann
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