Lockheed Martin and Rheinmetall Team Up to Manufacture ATACMS Missiles in Germany

The U.S. defense giant Lockheed Martin and German arms manufacturer Rheinmetall have inked a memorandum of understanding to co-produce ATACMS (Army Tactical Missile System) missiles on German soil. This collaboration is a first for ATACMS missile manufacturing outside the United States.

Under the agreement, which carries the backing of Washington and Berlin, the two companies aim to establish a joint venture focused on turning the German facility into a European hub for the production, assembly, and distribution of these missiles. The primary market: NATO members and allied nations.

The missile production will take place at Rheinmetall's artillery plant in Unterluess, located in northern Germany, according to Rheinmetall's CEO Armin Papperger. This site will serve as the center for building the guided missile systems, signaling a significant shift in defense manufacturing geography.

This move comes amid heightened demand for missile stock replenishment and increased industrial defense capacity following sustained conflicts in Ukraine and the Middle East. The collaboration demonstrates a strategic effort to bolster allied supply chains and spread manufacturing capabilities across multiple countries.

Both governments' support highlights the political weight behind the deal, as it aligns with NATO's broader goals to strengthen interoperability and readiness among its members. The joint venture envisages leveraging Rheinmetall's expertise and Lockheed Martin's technology to ramp up missile production in the region.

Investors might note the development as a signal of growing defense cooperation between Europe and the U.S., with potential implications for regional defense equities and supply chains. The agreement was signed during a NATO Industry Forum, coinciding with the alliance's summit in Ankara, underscoring the geopolitical importance of this partnership.

The missile's production outside U.S. borders could also play a role in reducing delivery times and logistical bottlenecks for European NATO members, potentially strengthening regional deterrent capabilities.

For Rheinmetall, expanding into missile manufacturing adds to its artillery portfolio and reinforces its standing within the European defense sector. For Lockheed Martin, this could open doors to deeper collaboration and localized production in European markets.

Now, the industry will be watching how quickly the joint venture launches full-scale production, and whether other NATO allies might look to build similar partnerships to diversify their defense sourcing capabilities.