The German Defense Ministry under Boris Pistorius is ending the F126 project for the Bundeswehr. Rheinmetall faces pressure after recently acquiring the naval unit NVL. Shares in the defense company fell more than 18 percent at times.
The ministry wants to halt the multi-billion-euro program. Reasons include ongoing problems and delays with the original main contractor Damen. After Damen lost responsibility, Rheinmetall submitted an updated offer for the NVL unit.
The six frigates would have cost around 18 billion euros. Delivery would have taken place in 2032 instead of 2028. Rheinmetall had placed high hopes in the project.
Rheinmetall chief Armin Papperger announced in March that naval division revenue would grow from one billion to up to five billion euros by 2030. The operating margin was to reach about 15 percent. Without replacement orders the company must now adjust its forecast.
