€500 Million Invest Rheinmetall Opens Europe’s Largest Ammunition Plant in Germany

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Rheinmetall AG

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The German defense giant Rheinmetall is rapidly expanding its Unterlüß site in Lower Saxony, positioning it as Europe’s premier ammunition production hub. The facility might soon produce artillery shells at scale and potentially manufacture missiles for international partners, reflecting the surge in global defense demand.

Nestled between Hanover and Hamburg, Unterlüß is home to Rheinmetall’s most significant production site. The Düsseldorf-based company is set to commence serial production of artillery shells at its newly expanded facility, with operations ramping up in the coming years. CEO Armin Papperger emphasized the milestone: “We are opening a new chapter in both Rheinmetall’s corporate history and the history of our Unterlüß site in artillery production.”

Meeting a Surge in Demand

Rheinmetall is capitalizing on the current boom in the defense sector, fueled by geopolitical tensions and the ongoing conflict in Ukraine. Existing production capacities have proven insufficient, making Unterlüß a critical supplier to the Ukrainian military.The new plant will initially produce 25,000 155-millimeter artillery shells this year, with plans to scale output to 350,000 by 2027. Across all Rheinmetall sites, the company aims to reach 1.5 million shells annually, reinforcing its dominance as the leading Western manufacturer of 155-mm ammunition.

A Massive Footprint

Unterlüß, the company’s largest site, spans 60 square kilometers and has been testing weapons and ammunition since 1899. It is located near the Bundeswehr’s Bergen training ground, about 30 kilometers away. The groundbreaking for the new artillery production facility took place in 2024.Historically, Unterlüß had smaller-scale artillery production alongside other operations, including the Puma infantry fighting vehicle assembly and an extensive firing range. Now, artillery production will take center stage. Additionally, Rheinmetall plans to construct factories for rocket motors, possibly warheads, and a facility for RDX explosives and munitions filling.

Investment and Employment Boost

Rheinmetall has invested nearly €500 million in modernization and new production lines. The Unterlüß workforce currently exceeds 3,000 employees, with approximately 500 new jobs expected from the artillery expansion.

International Ambitions and Partnerships

Beyond Germany, Rheinmetall is exploring the rapid deployment of ammunition plants in NATO countries to strengthen domestic defense production.
 According to a report by the German business magazine WirtschaftsWoche, the expansion also ties in with collaboration with US defense contractor Lockheed Martin. Negotiations are underway to produce “ATACMS” and “Hellfire” missiles at Unterlüß, complementing Rheinmetall’s existing work on F-35 fuselage components.
 Lockheed’s European head, Dennis Göge, told WirtschaftsWoche that the Unterlüß expansion “provides greater capacity for missile and guided weapon production in our partnership.” Both companies are also planning to establish a European center of excellence for missile manufacturing and sales. (kib)