One year after the announcement of 100 billion euros in investments in the Bundeswehr, Germany’s armaments industry is looking to the future with optimism, but has also voiced criticism behind closed doors. “We are confident that we will now get orders across the board,” said the general manager of the Federal Association of the German Security and Defense Industry (BDSV), Hans-Christoph Atzpodien, the German Press Agency. The industry is ready as a partner of the Bundeswehr and can get started quickly. “The companies are highly motivated, especially since some of them have already taken entrepreneurial risks.”
In addition to the so-called special fund, an increase in the regular defense budget is also important, says Atzpodien. On February 27, 2022, against the background of the Russian war of aggression against Ukraine, Chancellor Olaf Scholz announced a “turning point” in which 100 billion euros would be made available for the German armed forces. So far, only a small portion of this money has been withdrawn. There were no orders for tanks or artillery as of early 2023.
This was partly due to the fact that the previous year was initially subject to provisional budgeting, which made it difficult to award new contracts. “It is unfortunate that there have only been a few orders from German companies from the special fund because politicians have been very busy with budgetary issues in the last year, but it cannot be changed,” says Atzpodien. He expects movement in the awarding of contracts in the coming weeks and months.
atmosphere in the armaments industry
Another defense industry representative, who declined to have his name and that of his company named, is frustrated by the long wait for orders. A year ago, the Ministry of Defense promised rapid action and demanded fast delivery in a hastily arranged online connection with the defense industry, the manager recalls. Little happened then. “The procurement system of the Bundeswehr is still in a deep sleep. It is slowed down and blocked.” It’s all taking way too long. Another industry representative sees it similarly: “There’s nothing quick – it’s the same as always, despite the changed world situation.”
Arms managers appear differently in public. This is also due to the fact that the Bundeswehr is their biggest customer – whom you don’t want to put off with authentic but undipolmatic statements.
Association representative Atzpodien meanwhile emphasizes the urgency of investments in the Bundeswehr. “As a society, we should recognize the need to spend even more on our security and thereby protect our democracy and Europe as a whole.” The Ukraine war has shown that one’s own peace urgently needs to be secured.
How is the new Secretary of Defense coming along?
Atzpodien is relieved that the SPD politician Boris Pistorius is now in charge of the defense ministry. “He is looking for a conversation with us and tackles the important equipment issues.” In the partnership between the Bundeswehr and the German armaments companies, trusting cooperation is important. Pistorius also makes that clear in his constructive way.
The largest armaments group in Germany is Rheinmetall with around 29,500 employees, 15,000 of them in Germany. The company has added jobs over the past year. Business is booming. The economically positive perspective is also due to increasing demand from other NATO and EU countries. A Rheinmetall spokesman said that Russia’s attack on Ukraine “again caused stronger and faster demand.” “We have years of strong growth ahead of us.” An order backlog of 30 billion euros is approaching, which should grow to 40 billion in the coming year.
Have orders already been distributed from the billion dollar package?
Rheinmetall is one of the few companies that has already received a small order from the special fund. This was about protective equipment for soldiers. With a view to future orders from the federal government, it says: “We are expecting large orders in the areas of ammunition, combat vehicles and further digitization.”
Also at the handgun manufacturer Heckler
