Computer Forum
Rheinmetall Aktie bricht um über 15 ein (Image © Smartbroker)
The decision to withdraw from the F126 project is due to unacceptable cost overruns. According to the Ministry of Defense, the transfer of the general contractor role to Naval Vessels Lüssern—which is now part of Rheinmetall—has driven the estimated cost for six ships to over 18 billion euros. This included a specific contract with NVL, valued at 15.2 billion euros.
Despite a proposal from Rheinmetall in May to take over the project for 12.8 billion euros, the government opted for a complete change of course. The cancellation comes after more than 2 billion euros had already been invested in the F126 program since 2020.
Switch to Meko-class frigates
The German Navy will now focus on procuring Meko-class frigates, which are specifically designed for anti-submarine warfare. The ministry intends to purchase a total of eight ships. The first four ships are budgeted at 6.3 billion euros, while a second option for an additional four ships is valued at 5.3 billion euros, provided this option is exercised by the end of 2026.
TKMS has already begun preliminary work on the project; delivery of the first Meko A-200-class frigate is scheduled for 2029. The company has also indicated that other German shipyards could potentially be involved should the government exercise the option for the remaining four ships.
Instability in European Defense Procurement
This shift in procurement is part of a broader trend of volatility within European defense initiatives. Germany and France recently canceled their joint FCAS fighter jet project, and the MGCS tank program remains about a decade behind schedule. Amid these systemic delays and cancellations, the Franco-German tank manufacturer KNDS has announced plans for a dual listing on the Frankfurt and Paris stock exchanges. Market sources estimate the company’s value at around 15 billion euros.
