Rheinmetall Sells Auto Unit, Focuses Fully on Defence

Complete divest from automotive sector Rheinmetall Concentrates on Defence

2026-06-04 From Detlev Karg 1 min Reading Time

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Rheinmetall is exiting its struggling automotive business to focus entirely on defence, agreeing to sell its civilian Power Systems division to private equity firm Aequita for a preliminary purchase price of €350 million.

Rheinmetall swaps bearings for bullets in defence push, (Picture: Rheinmetall AG) — Rheinmetall swaps bearings for bullets in defence push,
(Picture: Rheinmetall AG)

The division employs around 6,250 people. Rheinmetall said the price could still change before the transaction closes, which is expected by the end of the year. “This is a milestone in the company’s history,” Chief Executive Armin Papperger said. “We are concentrating on the high-margin military business, where we see excellent growth opportunities”, as he was cited in the media.

Rheinmetall profits from all-European orders

Western defence contractors have benefited from a surge in military spending since Russia’s invasion of Ukraine. Demand in Europe has been further boosted by U.S. President Donald Trump’s distancing from NATO and plans to withdraw U.S. troops from Germany. Rheinmetall has recently secured several major defence contracts. Romania, for example, placed orders worth about €5.7 billion for a defence package including tanks, ammunition and naval vessels. “We want to become a global champion,” Papperger said. “We are needed to strengthen the defence capabilities of Germany and Europe and to create effective deterrence.”

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