Rheinmetall in Ukraine: From Ammunition Plant to Strategic Partnership
The Rheinmetall–Ukraine partnership marks the first systemic case of integrating a global defense giant into Ukraine’s own production base. Beyond an ammunition plant scheduled for 2026, it signals the beginning of Ukraine’s long-term role in Europe’s defense industry
The idea of creating joint ventures in the military-industrial sector on the territory of Ukraine has long been voiced as a strategic goal. In 2023–2025, this process moved into the practical plane: the German concern Rheinmetall and the Ukrainian "Ukroboronprom" signed an agreement on the creation of a joint venture. This step became the first systemic case of involving Western defense giants in Ukraine's production infrastructure, and it is already clear that it will have far-reaching consequences for the country's economy and security.
Ammunition Factory: 2026 Will Become the Starting Point
The most discussed project is the construction of a Rheinmetall ammunition production factory in Ukraine. According to official plans, it is to start operating in 2026 and ensure the production of tens of thousands of shells annually. This will not only allow Ukraine to reduce dependence on supplies from abroad, but will also become part of the pan-European strategy to increase ammunition production in response to Russian aggression. The launch of the factory is a key step for forming the domestic arms market in Ukraine and a long-term guarantee of supplying the front.
Protection from Drones: Technologies Are Needed Here and Now
Another dimension of cooperation concerns new drone counteraction technologies. Rheinmetall has already announced the transfer to Ukraine of systems capable of effectively combating massive attacks by kamikaze drones, which Russia uses daily. This involves integrated complexes that can combine electronic warfare, classical air defense means, and automated control systems. This direction is especially important for Ukraine, because the war has essentially turned into a "drone" one, and without such solutions, the front would remain extremely vulnerable.
Creation of JV: The Legal Framework Is Already Working
The joint venture of Rheinmetall AG and "Ukroboronprom" has already been created and officially registered. As reported by the Ministry of Strategic Industries of Ukraine, its task is "restoration, production, and development of military equipment." This means that it is not only about ammunition, but also about armored vehicles, air defense systems, and repair of existing machines.
In fact, this is a precedent when one of the world's largest arms manufacturers does not just supply products to Ukraine, but creates its own production site here. Such a step demonstrates a high level of trust and the strategic nature of the vision.
Benefits Are for Both Sides: Economy and Security
For Ukraine, the benefit is obvious – the creation of jobs, localization of technologies, and gradual transformation into a regional hub of defense production. For Rheinmetall, this is also a unique opportunity: working directly on the battlefield allows testing and improving cutting-edge technologies in real conditions.
In its official blog, the company directly states: "We are not only supplying weapons, we are becoming part of Ukraine's defense architecture." This means that it is not about short-term benefits, but about a multi-year contract for mutual integration into NATO's production chains.
Why This Case Is Important for the Future
Cooperation with Rheinmetall can become a model for other players. If one of the leaders of the global arms industry is ready to work in Ukraine even during wartime, this is a signal for BAE Systems, Northrop Grumman, Kongsberg, and others. Joint ventures are not only about production, but also insurance against political risks: when factories are already operating in Kyiv or Lviv, it is much more difficult to stop support under pressure from internal opponents in the EU or the US.
Other Cases of Joint Ventures: From Maintenance to Full Production Cycle – What Is Already Working and What Can Be Launched
In addition to Rheinmetall, there is already a wide range of precedents that prove: international defense companies are ready to invest in Ukraine not only as a buyer, but as a production partner. The format of these cases is very diverse – from service centers and localization of assembly to joint design and full production cycle.
Practice shows three working models. The first is the creation of service and repair hubs: a foreign company opens a center in Ukraine for maintenance and modernization of equipment (repair of tanks, restoration of aircraft, maintenance of air defense), which gives a quick effect for the front and creates jobs without lengthy construction of production. The second model is localization of assembly and partial production: key components are imported, while assembly and testing are carried out in Ukraine; this allows quickly scaling up the production of final systems and adapting them to tactical requirements. The third, the most ambitious, is full localization with technology transfer: the creation of factories capable of manufacturing ammunition, armor, electronics, and even complex air defense components on Ukrainian territory.
Within these models, there are already examples worth noting. The Turkish company Baykar not only supplies unmanned aerial vehicles, but also invests in production and service capacities to ensure quick repairs and local assembly. This is a classic case of the second model, where the partner country receives both equipment and production expertise. Similar logic underlies agreements with some South European and Scandinavian companies that view Ukraine as a platform for assembling air defense and electronic warfare components, which reduces logistical risks and provides flexibility in modifications based on combat experience.
Another important category is cooperation at the level of ammunition and explosive components. In Europe, there are several manufacturers ready to relocate part of the supply chain to Ukraine – from manufacturing shell casings to filling and quality control. This not only shortens delivery times, but also reduces the vulnerability of Western supply chains in case of political changes in donor countries. The practice of the Czech Republic, Poland, and Slovakia regarding scaling up shell production is a relevant example that can be scaled with the participation of Ukrainian enterprises.
In addition, interest is growing in joint projects in the field of naval systems and anti-ship technologies – there is potential here for partnerships with companies specializing in ship missiles, sensors, and anti-drone systems for navies. Such investments logically combine with the modernization of port infrastructure and the creation of service centers for allied fleets in the Black Sea.
The economic effect of such cases is also clear: each JV creates direct jobs, a chain of subcontractors, demand for logistics and infrastructure, and most importantly – an innovation multiplier. When the number of high-tech productions grows in the country, demand arises for engineers, testing laboratories, training centers, and university programs – this transforms the local economy from raw material-based to production-innovative.
The Partnership Has Long-Term Potential
Rheinmetall and Ukraine have shown that joint productions are not theory, but practical reality. The ammunition factory, drone counteraction systems, and the registered JV create preconditions for Kyiv to become a center of military-industrial development in Eastern Europe. Everyone wins: Ukraine receives weapons and jobs, and the West – a strategic partner with unique combat experience.
This case has a chance to become a catalyst for a new wave of defense investments. The question is only about speed – whether Ukraine will continue to convince foreign partners that investing in production here is safer and more profitable than it seemed before.
Bohdan Popov, Head of Digital at the United Ukraine Think Tank, communications specialist and public figure