Rheinmetall Ponders Shedding Its Civil Unit Power Systems Amid Booming Arms Business
Discussion underway for Rheinmetall's civil power division sale
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In the wake of its arms division's surging profits, the Rheinmetall conglomerate might be parting ways with its Power Systems civil business. According to the company's CEO, Armin Papperger, during his online speech at the annual general meeting on May 13, discussions are underway with potential buyers, and every inquiry is being regarded thoughtfully [1].
The Power Systems division, which manufactures components for the flailing automotive industry, no longer forms a significant part of Rheinmetall's core operations, Papperger indicated. The company is attempting to adapt plants from this division for use in the security and defense sector, ensuring a secure future for its employees. As it stands, plants in Neuss and Berlin have already been assigned this purpose, Papperger confirmed.
For the Neuss plant, which currently employs around 1,500 workers predominantly for civil production, Rheinmetall is already preparing for a transition. In a recent announcement, the company revealed plans for a joint venture with Finnish firm ICEYE to manufacture satellites. Starting the second quarter of 2026, the Neuss plant might become one of the production sites for these spacecraft [2].
[1] Struggling automotive sector takes toll on Rheinmetall’s Power Systems division: https://ntv.de/
[2] Rheinmetall to partner with ICEYE for satellite production in Neuss plant: https://rts.de/
[3] Strategic emphasis on defense production: Repurposing of facilities suggests Rheinmetall may leverage existing infrastructure for defense purposes, but there is no clear indication of selling off the entire Power Systems division. (Enrichment Data)
- As Rheinmetall explores the possibility of divesting from its Power Systems division, discussions about merging the Neuss plant with Finnish firm ICEYE for satellite production indicate a potential shift towards space-and-astronomy and defense industries.
- The booming arms business within Rheinmetall, coupled with the underperformance of the Power Systems division in the automotive industry, seems to drive the company towards a science- and finance-oriented employment policy in its pursuit of increased security and defense sector involvement.
