Armor boom: Germany urgently needs more military steel!

Armor boom: Germany urgently needs more military steel!

Salzgitter, Deutschland - The armaments industry in Germany is currently experiencing a real boom. German companies such as Rheinmetall AG are increasingly asking domestic steel manufacturers to increase their production of military steel. They are in the shadow of geopolitical changes, which are particularly due to the war in Ukraine and the reorientation of defense policy in Europe. Livemint reports that these developments are also a major challenge, but also a chance for the steel industry represent.

Rheinmetall, Germany's leading armaments manufacturer, is particularly dependent on the Swedish steel manufacturer SSAB, which brings with it a certain risk of care. The shares of Rheinmetall have almost tripled this year and the market value of the company is now even overtaking that of Volkswagen. A real success story, which is characterized by an increase in the federal government's defense spending in addition to the relaxation of the "debt brake" and a general re -evaluation of military priorities. Economy.ac shows that Rheinmetall not only produces military hardware such as weapons and tanks, but also electronic solutions and ammunition systems.

In order to meet the increasing need, Rheinmetall expects a doubling of its need for military steel in the near future, which now comprises several thousand tons a year. Salzgitter AG and the AG of the Dillinger Hüttenwerke are actively responding to this call to strengthen the domestic supply chain, since Dillinger has been one of the military -certified manufacturers since 2021 that play a key role in the defense industry. Salzgitter's plans to supply the defense sector became more specific according to the revised fiscal rules of the German government. Livemint added that many smaller steel manufacturers like BENTELER already to the defense industries deliver, but do not want to build their own armor departments.

The Federal Republic is expected to invest more than 60 billion euros in the defense budget for 2025, which is an increase of around 15 %. This comes at a moment when the demand for high technology in the armaments area is steadily increasing due to the changed political climate in Europe. An investigation by EY etc. shows that these defense investments can not only help the military, but also provide impulses for the entire economy, which secured up to 1.3 million jobs or new could.

criticism and challenges

Nevertheless, the debate about domestic steel production and its support does not remain without resistance. Numerous steel manufacturers hesitate to increase their production capacities because the volume is not high enough to justify a justifying investment. Thyssenkrupp even explained that there are no plans to reopen a work closed in 2021. The aspiring companies in the industry are faced with the challenge of meeting the increased requirements, while at the same time they have to take care of the financial means for necessary investments.

Hans Christoph Atzpodia, chairman of the association of the German Security and Defense Industry, has requested state buying guarantees for steel production. Despite the recognition of steel as a question of national security, the government has so far taken no measures to specifically strengthen domestic production for military purposes. This could turn out to be a critical point in the coming months if the demand for military materials continues to increase.

Overall, the development in the German armaments industry is a fascinating topic that could not only change the military but also the country's economic landscape. The pressure on domestic steel manufacturers will increase, but at the same time the perspectives in a booming market are promising. It remains exciting to see how this industry will develop.