Berlin's military hardware production more than doubles within a span of four months
Berlin's arms industry is experiencing a significant boom, with the sector doubling in size over the past four months, growing from 50 to 100 dual-use companies [1]. This growth is primarily due to Germany's strategic decision under Chancellor Friedrich Merz to expand defense spending drastically amid geopolitical tensions, notably the Ukraine crisis and pressures from the U.S. to enhance European defense capabilities [1][3].
The increase is driven by a large-scale military buildup, with the defense budget planned to rise from about €62 billion in 2025 to over €150 billion by 2029, marking more than a doubling of spending [2][5]. Parliament is expected to approve major procurement programs, including advanced technologies and weapon systems [3][4].
One of the key players in this expansion is Pierburg, a former car parts manufacturer in Wedding, which is transitioning to produce artillery ammunition components for Rheinmetall [4]. The change has secured the jobs of its 350 employees for the time being [1].
Similarly, in Lübben, Brandenburg, a site that once produced Kalashnikov ammunition for the GDR is now producing ammunition for the Bundeswehr, with demand skyrocketing since the war in Ukraine [1]. This shift in defense production has led to a split among locals, with some welcoming the jobs and others opposing the arms buildup on their doorstep [2].
The types of technologies and armaments being produced include Eurofighter jets, Boxer armored vehicles, advanced missile defense systems, and digitalized military systems, among others [4]. Berlin firms are also producing miniature satellites, encryption systems, medical exoskeletons, and underwater sensors for defense purposes [4].
The growth in Berlin's arms industry is not typical; it is experiencing a significant boom. This military-industrial buildup is aligned with a broader fiscal policy shift that lifted Germany's constitutional debt brake, enabling a €500 billion fund for defense and infrastructure spending [2]. It corresponds to a consensus across Germany’s political spectrum supporting increased military expenditure, reflecting a unified national strategy in response to evolving security challenges in Europe [4].
However, there are economic debates about the efficiency of military spending in terms of GDP growth compared to other investments like infrastructure or education [3]. Despite these debates, the union IG Metall, often sceptical of arms work, has backed the move at Pierburg [1].
Meanwhile, Germandrones, a company based in Berlin, has shifted its production from drones for agriculture and disaster relief to supplying the Ukrainian defense ministry [1]. Attitudes towards defense production in Berlin are shifting, according to Berlin Partner's Stefan Franzke, due to Russia's war in Ukraine and changes in US NATO policy [1].
In conclusion, Berlin's arms industry growth is a manifestation of Germany’s strategic pivot toward European defense leadership through heavy investment in advanced conventional weapons, digital military technologies, and robust industrial capacity expansion. This shift is not just about military hardware but also about transforming Germany into a pivotal defense technological hub in Europe.
- The growth in Berlin's arms industry is not a mere increase; it is a significant boom, primarily driven by a large-scale military buildup and a strategic shift in Germany's spending priorities.
- The types of technologies and armaments being produced in Berlin's defense sector include Eurofighter jets, Boxer armored vehicles, advanced missile defense systems, digitalized military systems, and miniature satellites, among others, indicative of its role in becoming a defense technological hub in Europe.
- The expansion of Berlin's arms industry is not isolated; it corresponds to a broader fiscal policy shift in Germany, permitting a €500 billion fund for defense and infrastructure spending, reflecting a national strategy that spans across the political spectrum.
- Despite economic debates about the efficiency of military spending compared to other investments like infrastructure or education, support for the growth of Berlin's arms industry comes from various quarters, including the union IG Metall and local Berlin firms. This shift in attitudes is attributed to Russia's war in Ukraine and changes in US NATO policy.
