Rheinmetall secures $521m ammunition contract
German armaments builder Rheinmetall has secured a contract to supply ammunition to an undisclosed Eastern European customer.
The deal, valued at approximately €444m ($521m), will see Rheinmetall Expal Munitions deliver 155 mm M107 projectiles with M4A2 propellant charges and 105 mm M1 projectiles.
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Rheinmetall Expal Munitions, an ammunition and armament manufacturer, is a subcontractor for Global Military Products, a company commissioned by the US government.
Of the total contract value, €170m had been previously booked as a pre-order, with the recent addition of €274m in new orders.
Delivery of the ammunition is scheduled to commence in 2026 and reach completion in June 2027.
Rheinmetall is one of the major manufacturers of large-calibre ammunition globally. It offers an array of products including medium-calibre rounds for armoured vehicles, tank and artillery shells, aircraft armaments, and high-energy laser applications.
In line with growing demands, Rheinmetall has been expanding its production capabilities since 2022.
The company’s strategic plan aims to achieve an annual production capacity of up to 1.5 million 155 mm artillery shells by 2027.
The production growth comes amid escalating global tensions, with GlobalData intelligence projecting the global artillery system market to expand at a compound annual growth rate of 4.3%.
The market is expected to achieve a value of $17.3bn (£13bn) by 2034.
In May 2025, Rheinmetall announced plans to establish a new facility for large calibre gun barrel manufacturing in Telford, Northern England. Production at this facility is anticipated to start by 2027.
Additionally, the company recently revealed intentions to set up a new production site for 155 mm calibre artillery ammunition in Latvia with an investment totalling €275m ($321m).
In the first half of fiscal year 2025 (H1 FY25), Rheinmetall reported record sales and income figures driven by robust demand in the defence sector and a 36% increase in sales within the business segment.
Consolidated sales surged by 24% to €4.74bn ($5.52bn) in H1 FY25, compared to €3.82bn during the same period in the previous year.
