Rheinmetall Denel Munition (RDM) has announced a contract with Hungary for an explosives factory.
RDM on 4 January announced that Hungary is building a new explosives plant to produce Research Department eXplosive (RDX) at its site in Várpalota, with RDM supplying the necessary factory equipment and technology.
Rheinmetall Denel Munition (RDM) – is a partnership between the German parent and South African state-owned Denel.
Under the contract which is in the three-digit million euro range, says RDM, and signed on 15 December 2022, a new factory will be built and operated by a joint venture consisting of Rheinmetall and N7 Holding, a state-owned Hungarian enterprise.
“Now that the planning phase is complete, the project will start in 2023, so that production can begin by 2027. The explosives produced in the new plant can be used for artillery, tank, and mortar ammunition, among other things. The contract covers the supply of plant engineering, technology, and process know-how as well as the associated documentation, training, and all activities necessary to achieve full-scale production,” RDM said in a statement.
The project is a strategic investment by Hungary in cooperation with Rheinmetall in response to the shortage of explosives resulting from strong demand for ammunition in Europe and NATO, the company explained. “At the same time, it promotes Europe’s independence from overseas imports in this sector.”
This new contract is coming few weeks after RDM was given a contract to supply a NATO country with 155mm ammunition.
Russia’s invasion of Ukraine in February last year has led to a massive increase in the demand for ammunition as countries provide ammunition in support of Ukraine. Russia has turned to North Korea for ammunition, and Ukraine has even received ammunition from Pakistan. Ukraine has also resorted to manufacturing its own artillery ammunition.
Once completed and taken over by the Hungarian state, Rheinmetall AG will be the primary customer for the explosives produced by the plant.
RDM specialises in the development, design and manufacture of large and medium calibre ammunition as well as plant engineering. It has been receiving substantial ammunition orders in recent years and in December announced that a long-time NATO customer had awarded it a framework contract for the supply of 155 mm Assegai ammunition. The framework agreement was concluded in December and has a term of five years.
RDM has established ammunition filling plants in three dozen different countries over the last three decades. Some relatively recent customers include Saudi Arabia, which in 2016 commissioned a munitions factory built by RDM in conjunction with Saudi Arabia’s military Industries Corporation.
The following year RDM commissioned a plant in Egypt. This has the capability to fill a variety of munition products, including medium and large calibre ammunition through to aircraft bombs. It was established over a four year period.
RDM continues to enjoy widespread export success for it’s ammunition from customers both in NATO, Asia, and Africa.
40mm ammunition contract
Just last week, Two European NATO customers signed contracts with Rheinmetall to supply their armed forces with 40mm ammunition. The total value of these contracts exceeds €30 million.
The first customer contracted the German firm in December for 300,000 rounds, including low-velocity and high-velocity variants, issuing a first purchase order for 75,000 cartridges.
In a separate contract, the customer ordered 45,000 programmable cartridges in 40 mm x 53 high velocity high explosive-tracer airburst munitions for delivery in the first half of 2024.
Meanwhile, Rheinmetall will deliver 10,000 counter-drone rounds to the second customer, starting in mid-2023.
Three years ago, RDM secured a contract for 40 mm grenade and 76 mm gun ammunition from an international client.
In 2021, the Hungarian Ministry of Defence signed a contract with Rheinmetall to supply an extensive package of ammunition worth several hundred million euros. The order encompasses ammunition for infantry fighting vehicles, main battle tanks, artillery, and decoy systems. Delivery is starting in 2023 and is to be complete by 2031.
In August 2022, Rheinmetall Denel Munition (RDM) supplied 155mm ammunition from the Assegai product line to a NATO customer.
