Leonardo and Rheinmetall Secure Reported $4.16 Billion Italian Army Contracts

Leopard 2A7V main battle tank is operated by the German Army, representing modern armored warfare technology relevant to Europe's ongoing tank modernization programs.Image reference: Wikimedia Commons – Leopard 2 A7V, Bad Frankenhausen, 2024

It is reported that the joint venture of Leonardo of Italy and Rheinmetall of Germany, Leonardo Rheinmetall Military Vehicles, has won two contracts from the Italian Army totaling €3.7 billion ($4.16 billion). As per a Reuters report, citing the financial newspaper MF of Italy, the contracts include new armored combat vehicles and main battle tanks.

Infantry Fighting Vehicle Program (A2CS)

The first order relates to the development of the Army Armoured Combat System (A2CS), which is meant to bring about modernization of the mechanized infantry of Italy using tracked armored vehicles.

The A2CS vehicles will have their basis on Rheinmetall's Lynx KF41 vehicle but with systems from Italy incorporated in the design. Earlier on, Leonardo and Rheinmetall revealed that an initial agreement had been reached for twenty-one A2CS vehicles.

New Main Battle Tanks for the Italian Armed Forces

The second mentioned contract relates to the development of a new main battle tank in Italy aimed at replacing old Ariete tanks gradually. In this case, the reference vehicle is the KF51 Panther from Rheinmetall, and technologies/solutions are provided by Leonardo for the Italian version of the MBT.

The project is one of the parts of a general program on modernizing Italy’s heavy ground combat vehicles. EDR Magazine gives additional information on the vehicles ordered.

Defense Industry Collaboration between Italy and Germany

These agreements will increase collaboration between the two firms, which formed their joint venture in 2024. This joint venture merges the strengths of Rheinmetall in manufacturing armored vehicles with those of Leonardo in electronic systems and defense systems integration.

Based on the information released by the joint venture firms regarding the joint venture, 60% of all industrial operations shall be conducted in Italy.

Confirmation of the Contract and the Following Steps

While the combined worth of the contract has already been covered by Italian media outlets, this information should be qualified properly. According to Reuters, Rheinmetall declined to comment on the issue, while Leonardo’s CEO Lorenzo Mariani noted that he was unable to confirm the signing of the contracts as they need to be coordinated with the customers

In case the reported deal worth €3.7 billion becomes a reality, it will be a major milestone for Italy with regard to the modernization of its armored vehicles.

Author: Kevin Macmellon

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