The new Rheinmetall ammunition plant in Várpalota, Hungary, currently being built by the Hungarian holding company N7 on behalf of the joint venture company Rheinmetall Hungary Munitions Zrt, has moved into a second phase of construction, Rheinmetall announced on 30 January 2024.
Although European demand for ammunition has been high since the Russian invasion of Ukraine in February 2022, the concept for a multi-phase expansion of the Várpalota facility had already existed prior to then. The project constitutes a strategic Hungarian investment in co-operation with Rheinmetall in response to a shortfall in ammunition already apparent at the time, given the anticipated increase in demand in Europe and NATO. The project also has the added aim of reducing Europe’s dependence on overseas imports.
A year ago the foundation stone was laid in Várpalota for the first part of the new Rheinmetall plant, where Rheinmetall Hungary Munitions will in future produce ammunition for various systems. The first expansion phase of the plant will enable production of 30 mm medium-calibre ammunition for the Lynx infantry fighting vehicles that will be built by Rheinmetall at its new tank plant in Zalaegerszeg, Hungary, where production starts this year.
Now set to begin, the ‘Várpalota 2.0’ expansion will increase the size of the plant by 20 hectares to approximately 120 hectares, with the number of employees growing to up to 200.
In addition, the plant’s product range will expand to include new types of ammunition, principally 155 mm artillery shells for the PzH 2000 self-propelled howitzer and 120 mm ammunition for the Leopard 2 main battle tank and its potential successor, the Panther KF51 EVO, production of which is slated to begin in early 2026.
Rheinmetall also plans to carry out development and acceptance testing at Várpalota.
Part of the strategic expansion of ammunition production capacity in Hungary is an additional plant for the production of explosives (RDX), which is being built in parallel on the same site and also under a joint venture between Rheinmetall and N7. This will also make a major contribution to ensuring the security of supply of this elementary raw material for ammunition production in Europe.
Part of the Várpalota plant’s output will meet the needs of the Hungarian armed forces, with the rest destined for export.
In addition to the newly built plant operated by Rheinmetall Hungary Munitions, today Rheinmetall already produces ammunition in Germany, Spain, Switzerland, Austria, Italy, South Africa, Australia and the United States.
