Lockheed Martin expands European missile production with Rheinmetall

Jan de Vries · 2026-07-07

Lockheed Martin has announced new European missile projects aimed at strengthening NATO air defense. The initiative includes expanding production of ATACMS (Army Tactical Missile Systems) in partnership with German defense contractor Rheinmetall. This move comes as NATO allies seek to bolster their defensive capabilities amid rising geopolitical tensions. ### Why this matters for European defense Europe's air defense systems have been under scrutiny since the conflict in Ukraine highlighted gaps in missile coverage. NATO members are now investing heavily in modernizing their arsenals. Lockheed Martin's partnership with Rheinmetall is a direct response to that need. By producing ATACMS on European soil, the companies can deliver missiles faster and at lower costs. Here's what the expansion means: - **Faster delivery times**: Local production cuts shipping delays from months to weeks. - **Lower costs**: Manufacturing in Europe avoids transatlantic freight charges and import duties. - **Job creation**: New facilities will employ hundreds of skilled workers across Germany and other partner nations. - **Supply chain resilience**: Reducing reliance on U.S.-based factories strengthens NATO's overall readiness. ### The ATACMS missile system ATACMS is a long-range, precision-guided missile that can strike targets up to 190 miles away. It's launched from the M270 Multiple Launch Rocket System or the M142 High Mobility Artillery Rocket System (HIMARS). These systems are already in use by several NATO countries, including Poland, Romania, and the Baltic states. > "ATACMS gives our forces the ability to hit high-value targets deep behind enemy lines," said a Lockheed Martin spokesperson. "Expanding production in Europe ensures our allies have the firepower they need when they need it." ### Rheinmetall's role in the partnership Rheinmetall, based in Düsseldorf, Germany, is one of Europe's largest defense contractors. The company will handle final assembly and testing of the missiles at its new facility in Saxony. This factory is expected to be operational by 2027 and will have the capacity to produce hundreds of missiles annually. Rheinmetall already supplies artillery shells and tank components to the German military. This partnership marks a significant expansion into missile systems, which could open doors for future contracts with other NATO members. ### Impact on U.S. defense industry For American companies like Lockheed Martin, expanding into Europe makes good business sense. The U.S. defense budget is under constant pressure, and European sales provide a stable revenue stream. The partnership also helps Lockheed meet its obligations under the U.S. Foreign Military Sales program, which requires local manufacturing in some cases. ### What's next for European missile defense? NATO's air defense strategy is evolving. In addition to ATACMS, the alliance is investing in: - **Patriot missile systems**: Upgraded interceptors for ballistic missile threats. - **IRIS-T SLM**: A medium-range air defense system from Germany. - **NASAMS**: A Norwegian-developed system now deployed in Ukraine. Lockheed Martin's announcement is just one piece of a larger puzzle. As European nations increase their defense spending to 2% of GDP or more, the demand for missiles will only grow. This partnership positions both companies to capture a significant share of that market. ### Key takeaways The Lockheed Martin-Rheinmetall deal is a win-win for NATO. It strengthens air defense, creates jobs, and reduces logistical bottlenecks. For the United States, it means a stronger alliance and a more secure Europe. For Germany, it's a step toward becoming a major hub for missile production. As the NATO summit continues, expect more announcements like this one. The message is clear: Europe is serious about defense, and American companies are ready to help.