Where such madness leads

‘Global arms champion’

Rheinmetall, Germany’s largest weapons maker, has so far been the biggest beneficiary of the massive rearmament programme launched by the Federal Government in 2022 and now being intensified on an unprecedented scale. The company’s turnover was recorded at 6.4 billion euro in 2022. Having already reached 9.8 billion euro by 2024, sales could rise to between 40 and 50 billion euro by 2030, according to CEO Armin Papperger. This would propel the company into the top league of global arms manufacturers. The world’s two largest defence contractors are Lockheed Martin and RTX (both based in the US) generated revenues of around 61 billion and 41 billion US dollars respectively in 2023. Rheinmetall is closing the gap, on its way to becoming “a global defence champion”, as Papperger bluntly claimed at the beginning of August.[1] The volume of orders already on the books of the Düsseldorf-based arms manufacturer is steadily expanding. According to the company’s own figures, munitions orders currently stand at a record level 63 billion euros. The only poorly performing operations in the group’s portfolio are in its civil division. Rheinmetall runs a major automotive supply division that once served to compensate for recurring business weaknesses on the defence side. Now, however, Rheinmetall is  transitioning some of its previously civil production sites to military purposes. Indeed, the group is also considering the sale of those civil-sector factories that cannot be used for weapons production.

Europe’s second-largest ammunition factory

The Rheinmetall plant in Unterlüß, where the new ammunition factory was opened today, Wednesday, will soon be the group’s largest production site, employing around 3,200 people. The Rheinmetall group currently employs around 40,000 people at 174 production facilities located in more than thirty countries. This number is set to rise to around 70,000 employees over the next two to three years. In Unterlüß, Rheinmetall manufactures all kinds of ammunition as well as key components for the Leopard 2 battle tank, the armoured howitzer 2000 and the Puma infantry fighting vehicle. The plant has also been involved in the development of the new Panther KF51 battle tank, envisaged as the successor to the Leopard 2.[2] By the end of the year, the upgraded ammunition factory will already be producing tens of thousands of NATO 155 calibre artillery shells and intends to ramp up annual output to around 350,000 units by 2027. This figure is five times Rheinmetall’s total output back in 2022 (70,000 units). Internationally, it is the group’s second-largest ammunition factory, the biggest being Rheinmetall Expal Munitions, which is based in Spain and produces up to 450,000 artillery shells annually. With the help of its numerous other factories in Italy, South Africa and the United States, among other places, Rheinmetall aims to produce a massive total of 1.5 million 155-millimetre shells annually by 2027.

Orders worth up to 300 billion euros

Rheinmetall’s expansion plans include building new factories both in Germany and in various other European countries – for example, in Hungary and Lithuania, where production will start in 2026, and in Ukraine and Bulgaria, where, as reported earlier this week, Papperger will invest more than 1 billion euros to build a munitions factory and Europe’s largest gunpowder plant, respectively.[3] Papperger explains the scale of the ammunition business by noting that NATO countries are officially required to maintain ammunition reserves for thirty days of warfare: “For thirty days alone, we [the German Bundeswehr, ed.] need about 300 rounds per day per gun. With 5,000 guns, that’s 45 million rounds of artillery ammunition.”[4] And it is not only ammunition production that is being massively ramped up. Rheinmetall – like the entire arms industry – expects demand for weapons and military equipment in NATO countries across Europe to rise dramatically this year following the five per cent of GDP commitment made at the recent NATO summit. This trend will, of course, be seen most strongly in Germany, which has the greatest scope for financing a huge wave of rearmament thanks to its new debt facility. Papperger predicts an “order potential of up to 300 billion euros by 2030” for the whole Rheinmetall group.[5]

Record budgets and funding gaps

The German government’s plans to dramatically boost the defence budget required to meet this level of military spending are well known. The Bundeswehr allocation for this year has been increased by some 20 per cent over last year, bringing it to 62.4 billion euros; and added to this figure is the approximately 24 billion euros from the so-called ‘special fund’. Under the budgetary plans for 2026, defence spending will rise to a total of 82.7 billion euros plus another 25.5 billion euros from the ‘special fund’ facility. In 2027, which is the last year for drawing down the ‘special fund’, the defence budget is expected to total 93.4 billion euros. Then, in 2028, the diversion of resources into the military will soar to a spend of almost 136.5 billion euros and, in 2029, reach an eye-watering 152.8 billion euros.[6] And these figures do not yet include the expenditure planned for military-relevant infrastructure, which is expected to amount to roughly 70 billion a year by 2029. In order to pay for this rapid remilitarisation, the government – at least under current financial plans – will have to increase the national budget to more than 572 billion euros by 2029. The military allocation will claim 26.7 per cent of this volume.[7] To finance this, additional net borrowing is envisaged at 126.9 billion euros is envisaged for 2029 – increasing by more than half of the 2025 borrowing figure (81.8 billion euros). Nevertheless, Finance Minister Lars Klingbeil (SPD) says he still reckons with a huge and widening funding gap: 34 billion in 2027, 64 billion in 2028, 74 billion in 2029.[8]

Dismantling the welfare state

In Berlin, the debate is heating up on the dramatic spending cuts that are necessary to realise the government’s unprecedented rearmament plans. Chancellor Friedrich Merz announced at the end of last week that “the welfare state as we know it today is no longer economically sustainable.” Swingeing cuts, referred to as “reforms”, were inevitable: “I won’t be put off by those who say we are dismantling and slashing the welfare state, nor by whatever else comes along,” Merz declared.[9] CDU Secretary-General Carsten Linnemann called for a “paradigm shift” in an age when the “welfare state has become unaffordable”. There is widespread talk in government circles of an “autumn of reforms”, which is not challenged in principle by Vice-Chancellor Klingbeil, who is also the federal chairman of the SPD. Klingbeil has joined in the verbal attack on the welfare-dependent: no one can now get away with “lying back and doing nothing”, he intones. The government must “tackle the social security systems”. Unlike his CDU/CSU coalition partners, however, Klingbeil says it is not enough to simply “save 30 billion through the welfare state cuts”; rather, “people with very high assets and incomes”, should also “contribute their share”.[10]

‘War on war’

While the federal government is indeed preparing the ground for “dismantling and slashing the welfare state” (Merz), growing state repression is targeted against those protesting the hundreds of billions of euros going into remilitarisation. Activists running an “anti-war camp” in Cologne under the slogan “Disarm Rheinmetall – Against weapon exports, military build-up and war!” had to legally defend their constitutional right of assembly. The police authorities tried to ban the initiative, arguing that the initiative’s slogan “War on war!” implied the use of “war-like means”.[11] Did the authorities believe that activists would drive tanks from Cologne to neighbouring Düsseldorf and fire on Rheinmetall’s group headquarters? Ultimately the camp’s legal challenge succeeded when the Higher Administrative Court of North Rhine-Westphalia overturned the initial ruling. In fact, “War on war” is the title of a poem written in 1919 by the writer and anti-war activist Kurt Tucholsky. In it, Tucholsky described the horror of the trenches (“blood and crushed bones and dirt”) as well as his regret at the lack of resistance (“no one daring to rebel”). Tuchosky’s warning: “We must not and should not go on like this. All of us, all of us, have seen where such madness leads.”

[1] Rheinmetall trotz Rekordumsatzes mit Kursrutsch. tagesschau.de 07.08.2025.

[2] Kriegstüchtig in Rekordzeit: Rheinmetall startet Testbetrieb in seiner größten Munitionsfabrik. rundblick-niedersachsen.de 23.07.2025. See also: Der Panthersprung nach Kiew.

[3] Ewan Jones: Rheinmetall to build Europe’s largest gunpowder factory in Bulgaria. tvpworld.com 26.08.2025.

[4], [5] Roman Tyborski, Alexander Voß, Martin Knobbe: Papperger rechnet mit Aufträgen von bis zu 300 Milliarden Euro. handelsblatt.com 17.04.2025.

[6] Deutlicher Anstieg des Verteidigungshaushalts ab 2025. bmvg.de 24.06.2025.

[7] Bundesregierung führt Investitionsoffensive fort: Bundeshaushalt 2026 und Finanzplan bis 2029 beschlossen. bundesfinanzministerium.de 30.07.2025.

[8] Klingbeil richtet dringenden Sparaufruf an alle Ministerien. Frankfurter Allgemeine Zeitung 23.08.2025.

[9] Merz will harte Reformdebatte führen. tagesschau.de 23.08.2025.

[10] Vor dem “Herbst der Reformen” wartet noch viel Arbeit. tagesschau.de 25.08.2025.

[11] Rheinmetall-Entwaffnen-Camp verboten: “Jetzt erst recht: Krieg dem Krieg!” perspektive-online.net 13.08.2025.